Air Force awards $60M+ for Sniper targeting pod sustainment to Lockheed Martin

Contract Overview

Contract Amount: $60,020,654 ($60.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2017-12-18

End Date: 2021-02-28

Contract Duration: 1,168 days

Daily Burn Rate: $51.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: USAF COMPREHENSIVE ADVANCED TARGETING POD (CATP) SUSTAINMENT SERVICES FOR THE AN/AAQ-33 SNIPER

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $60.0 million to LOCKHEED MARTIN CORPORATION for work described as: USAF COMPREHENSIVE ADVANCED TARGETING POD (CATP) SUSTAINMENT SERVICES FOR THE AN/AAQ-33 SNIPER Key points: 1. Contract awarded on a sole-source basis, limiting price competition. 2. Sustainment services are critical for maintaining advanced targeting capabilities. 3. The contract duration of nearly four years indicates a long-term need. 4. Fixed-price contract type shifts some performance risk to the contractor. 5. The specific nature of targeting pod sustainment suggests a high degree of technical expertise required. 6. Geographic focus on Florida for service delivery.

Value Assessment

Rating: fair

The contract value of over $60 million for sustainment services over approximately four years appears to be within a reasonable range for specialized aerospace equipment. However, without comparable sole-source contracts for similar advanced targeting pod sustainment, a precise value-for-money assessment is challenging. The firm-fixed-price structure provides some cost certainty, but the lack of competition prevents benchmarking against market alternatives.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Lockheed Martin Corporation, was solicited. This approach is typically used when a unique capability or proprietary technology is involved, and competition is not feasible or cost-effective. The lack of competition means that taxpayers did not benefit from potential price reductions that could arise from a competitive bidding process.

Taxpayer Impact: Sole-source awards generally result in higher prices for taxpayers compared to competed contracts, as there is no market pressure to drive down costs.

Public Impact

The U.S. Air Force benefits from the continued operational readiness of its advanced targeting pods. Services ensure the effective functioning of the AN/AAQ-33 Sniper targeting system on various aircraft platforms. Geographic impact is concentrated in Florida, where sustainment activities are likely performed. Workforce implications include specialized technical roles for maintaining complex aerospace systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits transparency and potential cost savings.
Lack of competition may lead to higher prices than a competitive environment.
Contract duration could lock in costs without periodic re-evaluation of market rates.

Positive Signals

Firm-fixed-price contract provides cost certainty for the government.
Sustainment ensures critical operational capability for the Air Force.
Long-term contract indicates a stable and predictable support structure.

Sector Analysis

The aerospace and defense sector is characterized by high R&D costs, complex supply chains, and significant government procurement. Sustainment services for advanced avionics, such as targeting pods, represent a critical segment of this market. Companies like Lockheed Martin are key players, often holding proprietary knowledge and manufacturing capabilities for specialized systems. Benchmarking this contract against other sustainment contracts for similar complex military hardware would provide further context on its value.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb: false'. Given the specialized nature of targeting pod sustainment, it is unlikely that significant subcontracting opportunities for small businesses would be mandated or readily available, unless specific components or services fall within their capabilities and are identified by the prime contractor.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force's contracting and program management offices. The firm-fixed-price nature of the contract provides a degree of accountability for the contractor to deliver services within the agreed-upon price. Transparency is limited due to the sole-source nature of the award, making public scrutiny of pricing and performance benchmarks more difficult.

Related Government Programs

Air Force Aircraft Maintenance
Avionics Systems Support
Advanced Targeting Systems
Defense Contractor Sustainment

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $60.0 million to LOCKHEED MARTIN CORPORATION. USAF COMPREHENSIVE ADVANCED TARGETING POD (CATP) SUSTAINMENT SERVICES FOR THE AN/AAQ-33 SNIPER

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Air Force).

What is the total obligated amount?

The obligated amount is $60.0 million.

What is the period of performance?

Start: 2017-12-18. End: 2021-02-28.

What is Lockheed Martin's track record with the AN/AAQ-33 Sniper targeting pod sustainment?

Lockheed Martin Corporation, as the original equipment manufacturer, is the logical provider for sustainment services of the AN/AAQ-33 Sniper Advanced Targeting Pod. Their track record is intrinsically linked to the development, production, and ongoing support of this system. The company possesses the proprietary technical data, specialized tooling, and trained personnel necessary for effective maintenance, repair, and overhaul. Past performance on similar sustainment contracts for complex defense systems would indicate their capability to meet the Air Force's requirements for readiness and reliability of the Sniper pods.

How does the pricing of this contract compare to similar sustainment contracts for advanced targeting systems?

A direct comparison of pricing for this $60M+ contract is challenging due to its sole-source nature and the specific technical requirements of the AN/AAQ-33 Sniper pod. Sole-source awards inherently lack the price discovery mechanism of competitive bidding, often leading to higher costs. To benchmark effectively, one would need to identify other sustainment contracts for comparable advanced targeting pods (e.g., targeting pods on other platforms or from different manufacturers) that were awarded competitively. Analyzing the cost per pod-year or cost per flight hour for those competitive contracts would provide a more objective measure of value for money.

What are the primary risks associated with this sole-source sustainment contract?

The primary risk associated with this sole-source sustainment contract is the potential for inflated pricing due to the absence of competition. Without competing bids, Lockheed Martin has less incentive to offer the most cost-effective solution. Another risk is contractor dependency; the Air Force becomes reliant on a single provider, potentially limiting flexibility in future contract negotiations or technology upgrades. Furthermore, the lack of transparency inherent in sole-source awards makes it difficult to independently verify the reasonableness of costs and the efficiency of the services provided.

How effective is the AN/AAQ-33 Sniper targeting pod, and how does this sustainment contract contribute to its effectiveness?

The AN/AAQ-33 Sniper Advanced Targeting Pod is a critical electro-optical/infrared (EO/IR) targeting system used by the U.S. Air Force and allied nations to provide high-resolution imagery for target identification and tracking during day and night operations. Its effectiveness is crucial for precision strike capabilities and situational awareness. This sustainment contract directly contributes to its effectiveness by ensuring the pods remain operational, calibrated, and repaired. Regular maintenance and timely repairs prevent degradation of performance, maintain accuracy, and ensure the system is available when needed for combat missions, thereby maximizing the return on the initial investment in the technology.

What are the historical spending patterns for AN/AAQ-33 Sniper targeting pod sustainment?

Historical spending data for AN/AAQ-33 Sniper targeting pod sustainment prior to this contract would provide valuable context. Analyzing previous contracts, their values, durations, and whether they were competed or sole-sourced, would reveal trends in sustainment costs. For instance, if previous sustainment efforts were significantly less expensive or were competed successfully, it might raise questions about the current sole-source award's pricing. Conversely, if costs have steadily increased due to evolving technical requirements or inflation, it could justify the current expenditure. Access to historical contract databases would be necessary for a thorough analysis.

Industry Classification

NAICS: Other Services (except Public Administration) › Electronic and Precision Equipment Repair and Maintenance › Other Electronic and Precision Equipment Repair and Maintenance

Product/Service Code: ELECTRICAL/ELECTRONIC EQPT COMPNTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: FA852316R0022

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 5600 W SAND LAKE RD # MP-265, ORLANDO, FL, 32819

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $60,020,654

Exercised Options: $60,020,654

Current Obligation: $60,020,654

Subaward Activity

Number of Subawards: 106

Total Subaward Amount: $44,451,301

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA854018D0001

IDV Type: IDC

Timeline