Air Force awards $13.1M Lockheed Martin contract for C-130J sustainment, raising competition concerns
Contract Overview
Contract Amount: $13,068,861 ($13.1M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2025-01-01
End Date: 2026-12-31
Contract Duration: 729 days
Daily Burn Rate: $17.9K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: THIS TASK DESCRIPTION DEFINES THE CONTRACTORS REQUIREMENTS TO PROVIDE LTS FOR RNOAF. LTS SUPPORT INCLUDE PROGRAM MANAGEMENT SUPPORT, MATERIAL MANAGEMENT TO INCLUDE C-130J PECULIAR AND COMMON PROCUREMENT AND REPLENISHMENT OF SPARES.
Place of Performance
Location: MARIETTA, COBB County, GEORGIA, 30063
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $13.1 million to LOCKHEED MARTIN CORP for work described as: THIS TASK DESCRIPTION DEFINES THE CONTRACTORS REQUIREMENTS TO PROVIDE LTS FOR RNOAF. LTS SUPPORT INCLUDE PROGRAM MANAGEMENT SUPPORT, MATERIAL MANAGEMENT TO INCLUDE C-130J PECULIAR AND COMMON PROCUREMENT AND REPLENISHMENT OF SPARES. Key points: 1. Contract focuses on critical C-130J sustainment, including program management and spare parts. 2. Sole-source award to Lockheed Martin, the original equipment manufacturer, limits competitive pricing. 3. High risk of inflated costs due to lack of competition and reliance on OEM. 4. Spending falls within the Aircraft Engine and Engine Parts Manufacturing sector.
Value Assessment
Rating: questionable
The contract value of $13.1M for 729 days of support is difficult to benchmark without specific task details. However, given the sole-source nature and reliance on the OEM, there's a significant risk of pricing not reflecting competitive market rates.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, as it is not available for competition. This significantly limits price discovery and potentially leads to higher costs for the government compared to a competitive procurement.
Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may be paying a premium for sustainment services and parts, as there is no market pressure to drive down costs.
Public Impact
Ensures continued operational readiness of the C-130J Super Hercules fleet. Supports critical logistics and maintenance for a vital military transport aircraft. Potential for increased costs to taxpayers due to sole-source nature.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
Positive Signals
- Ensures critical sustainment for C-130J
- Experienced contractor (OEM)
Sector Analysis
This contract falls under the Aircraft Engine and Engine Parts Manufacturing sector, specifically supporting the C-130J aircraft. Spending in this area is crucial for maintaining military aviation capabilities, but often involves high costs due to specialized components and OEM reliance.
Small Business Impact
The data indicates this contract was not awarded to small businesses. There is no indication of subcontracting opportunities for small businesses within this sole-source award.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential cost creep. Robust auditing of contractor expenditures will be essential for accountability.
Related Government Programs
- Aircraft Engine and Engine Parts Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Reliance on OEM for parts and support.
- Lack of transparency in pricing justification.
- No small business participation indicated.
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 $13.1 million to LOCKHEED MARTIN CORP. THIS TASK DESCRIPTION DEFINES THE CONTRACTORS REQUIREMENTS TO PROVIDE LTS FOR RNOAF. LTS SUPPORT INCLUDE PROGRAM MANAGEMENT SUPPORT, MATERIAL MANAGEMENT TO INCLUDE C-130J PECULIAR AND COMMON PROCUREMENT AND REPLENISHMENT OF SPARES.
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 $13.1 million.
What is the period of performance?
Start: 2025-01-01. End: 2026-12-31.
What is the justification for the sole-source award, and have alternative competitive strategies been fully explored?
The justification for the sole-source award is that the requirement is 'NOT AVAILABLE FOR COMPETITION'. This typically implies a unique capability or proprietary technology held by the incumbent, in this case, Lockheed Martin as the OEM. While alternatives may have been considered, the 'not available for competition' designation suggests they were deemed unsuitable or infeasible, potentially limiting price discovery and increasing costs.
How will the Air Force ensure cost reasonableness and prevent overpricing given the lack of competition?
The Air Force can employ several strategies to mitigate cost risks. This includes rigorous negotiation of contract terms, establishing clear performance metrics, and conducting thorough audits of contractor costs and invoices. Benchmarking against similar sole-source contracts for other aircraft sustainment programs, where possible, can also provide some cost insight.
What is the long-term strategy for C-130J sustainment to potentially introduce more competition in the future?
The long-term strategy should involve exploring options for breaking down the sustainment package into components that could be competitively procured. This might include seeking alternative sources for specific parts, developing independent repair capabilities, or fostering competition among third-party logistics providers. Early planning and market research are key to enabling future competition.
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: FA855324R0008
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: $13,071,597
Exercised Options: $13,068,861
Current Obligation: $13,068,861
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: 2025-01-01
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2025-12-31
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