DoD Awards $15.5M for RNZAF C-130J Long-Term Sustainment to Lockheed Martin
Contract Overview
Contract Amount: $15,481,150 ($15.5M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2024-11-20
End Date: 2026-05-31
Contract Duration: 557 days
Daily Burn Rate: $27.8K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: LONG TERM SUSTAINMENT FOR THE ROYAL NEW ZEALAND AIR FORCE C-130J AIRCRAFT
Place of Performance
Location: MARIETTA, COBB County, GEORGIA, 30063
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $15.5 million to LOCKHEED MARTIN CORP for work described as: LONG TERM SUSTAINMENT FOR THE ROYAL NEW ZEALAND AIR FORCE C-130J AIRCRAFT Key points: 1. Contract awarded to sole-source provider Lockheed Martin for critical aircraft sustainment. 2. Significant portion of spending allocated to aircraft engine and parts manufacturing sector. 3. Potential risk associated with limited competition for specialized sustainment services. 4. Contract duration of 557 days with a firm fixed price structure.
Value Assessment
Rating: fair
The contract value of $15.5 million for a 557-day period appears reasonable given the specialized nature of C-130J sustainment. However, without direct comparable contracts for similar aircraft sustainment from other providers, a precise benchmark is difficult to establish.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The contract is sole-source, indicating a lack of competitive bidding. This limits price discovery and may result in higher costs for the government compared to a competitive procurement.
Taxpayer Impact: Taxpayer funds are being used for a sole-source contract, which inherently carries a higher risk of overpayment due to the absence of competitive pressure.
Public Impact
Ensures operational readiness of the Royal New Zealand Air Force's C-130J fleet. Supports critical defense capabilities through specialized aircraft maintenance and parts. Impacts the aerospace and defense manufacturing sector, specifically engine and parts suppliers.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price negotiation.
- Potential for cost overruns if market prices for parts fluctuate.
- Dependence on a single contractor for critical sustainment.
Positive Signals
- Ensures continuity of essential aircraft support.
- Firm fixed price contract provides cost certainty for the awarded amount.
- Supports a key international alliance partner's defense capabilities.
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on aircraft sustainment and parts manufacturing. Spending benchmarks in this area are highly variable, depending on aircraft type, age, and complexity.
Small Business Impact
There is no indication that small businesses are involved in this sole-source contract, which is typical for highly specialized defense sustainment requirements. Opportunities for small businesses may lie further down the supply chain.
Oversight & Accountability
The Department of the Air Force is responsible for oversight. The firm fixed price contract provides some level of financial accountability, but the sole-source nature warrants close monitoring of performance and any potential cost escalations.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source procurement limits competition.
- Potential for price increases on specialized parts.
- Dependence on a single supplier for critical components.
- Long-term sustainment costs can be unpredictable.
- Geopolitical factors could impact supply chain reliability.
Tags
aircraft-engine-and-engine-parts-manufac, department-of-defense, ga, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $15.5 million to LOCKHEED MARTIN CORP. LONG TERM SUSTAINMENT FOR THE ROYAL NEW ZEALAND AIR FORCE C-130J AIRCRAFT
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
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 $15.5 million.
What is the period of performance?
Start: 2024-11-20. End: 2026-05-31.
What is the justification for the sole-source award, and have alternative competitive strategies been considered?
The justification for a sole-source award typically stems from unique capabilities, proprietary technology, or the need for immediate support where competition is not feasible. For the RNZAF C-130J sustainment, it's likely due to Lockheed Martin's exclusive rights to original parts, technical data, and specialized maintenance procedures essential for this specific aircraft model. Alternative competitive strategies might have been explored, but often the complexity and specificity of military aircraft sustainment limit viable options.
How does the per-unit cost of sustainment compare to similar aircraft platforms or previous contracts for the C-130J?
Benchmarking the per-unit cost for this specific C-130J sustainment contract is challenging without access to detailed cost breakdowns and comparable data. Factors like the age of the aircraft, specific component needs, and the scope of services (e.g., scheduled maintenance vs. unscheduled repairs) significantly influence costs. A fair assessment would require comparing this contract's total value and duration against historical data for C-130J sustainment or similar military transport aircraft, considering inflation and evolving maintenance requirements.
What measures are in place to ensure the effectiveness and efficiency of the sustainment services provided by Lockheed Martin?
Effectiveness and efficiency are typically ensured through performance work statements (PWS) that define specific deliverables and service levels, key performance indicators (KPIs), and regular progress reviews. The Department of the Air Force would monitor Lockheed Martin's adherence to the PWS, track maintenance turnaround times, parts availability, and overall aircraft readiness metrics. Contract clauses may also include incentives for performance or penalties for deficiencies, ensuring the contractor meets the required standards for sustainment.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Engine and Engine Parts Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: FA855324R0005
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 86 SOUTH COBB DR, MARIETTA, GA, 30063
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: $25,628,498
Exercised Options: $15,481,150
Current Obligation: $15,481,150
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA855321D0001
IDV Type: IDC
Timeline
Start Date: 2024-11-20
Current End Date: 2026-05-31
Potential End Date: 2028-05-03 00:00:00
Last Modified: 2025-12-02
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