DoD's $36.4M Lockheed Martin Order for Air Transport Support Lacks Competition
Contract Overview
Contract Amount: $36,394,781 ($36.4M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2019-08-30
End Date: 2023-12-29
Contract Duration: 1,582 days
Daily Burn Rate: $23.0K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: RAPID DELIVERY ORDER 0001
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76108
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $36.4 million to LOCKHEED MARTIN CORPORATION for work described as: RAPID DELIVERY ORDER 0001 Key points: 1. Significant contract value of $36.4 million awarded to a single large business. 2. Lack of competition raises concerns about potential overpricing and value for taxpayer money. 3. The contract is for 'Other Support Activities for Air Transportation,' a critical but broad category. 4. Awarded to Lockheed Martin Corporation, a major defense contractor, indicating a focus on established players.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee, which can lead to higher costs if not managed carefully. Without competitive bidding, it's difficult to benchmark pricing against similar services, raising questions about whether the $36.4 million represents fair market value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was 'NOT COMPETED,' indicating a sole-source or limited competition award. This significantly reduces price discovery and negotiation leverage, potentially leading to higher costs for the government.
Taxpayer Impact: The lack of competition means taxpayers may be paying a premium for these air transportation support services, as there was no market pressure to drive down costs.
Public Impact
Taxpayers may be overpaying for essential air transportation support services due to the absence of competitive bidding. The reliance on a single, large contractor for critical support could create vendor lock-in and limit future flexibility. Transparency in pricing and performance is reduced when contracts are not competed, making oversight more challenging.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost Plus Fixed Fee contract type
- Award to large business
- Broad service category
Positive Signals
- Contract awarded to a known, established defense contractor
- Long-term contract duration (1582 days)
Sector Analysis
This contract falls under 'Other Support Activities for Air Transportation,' a sector that can encompass a wide range of services from maintenance to logistics. Spending in this area is crucial for military readiness, but competitive procurement is vital to ensure cost-effectiveness.
Small Business Impact
The contract was awarded to Lockheed Martin Corporation, a large business. There is no indication that small businesses were involved as subcontractors or partners in this specific delivery order, missing an opportunity for small business participation.
Oversight & Accountability
The 'NOT COMPETED' status suggests potential weaknesses in the procurement process or justification for bypassing competition. Robust oversight is needed to ensure the necessity of sole-source awards and to scrutinize costs and performance.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competitive bidding
- Potential for cost overruns due to CPFF structure
- Limited transparency in pricing
- No small business participation indicated
- Broad service category may obscure specific needs
Tags
other-support-activities-for-air-transpo, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $36.4 million to LOCKHEED MARTIN CORPORATION. RAPID DELIVERY ORDER 0001
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 $36.4 million.
What is the period of performance?
Start: 2019-08-30. End: 2023-12-29.
What was the specific justification for not competing this significant contract, and were alternative solutions explored?
The justification for not competing this contract is not detailed in the provided data. Typically, sole-source awards require a strong justification, such as a critical need, lack of available sources, or national security imperatives. Without this information, it's impossible to assess if alternative solutions were adequately explored or if the decision to bypass competition was fully warranted.
How does the Cost Plus Fixed Fee structure impact the government's risk and the contractor's incentive to control costs?
The Cost Plus Fixed Fee (CPFF) structure shifts some cost risk to the government, as it reimburses allowable costs plus a fixed fee. While the fixed fee incentivizes the contractor to manage costs to maximize profit, the government bears the primary risk of cost overruns. This structure can be less cost-effective than fixed-price contracts if not rigorously managed and monitored.
What performance metrics and deliverables are in place to ensure the effectiveness of these air transportation support services?
The provided data does not specify the performance metrics or deliverables associated with this contract. For a Cost Plus Fixed Fee contract, especially one that is not competed, clear and measurable performance standards are crucial for the government to ensure it is receiving the intended value and that the services are effective and meet operational requirements.
Industry Classification
NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 1 LOCKHEED BLVD BLDG 10, FORT WORTH, TX, 76108
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: $36,394,784
Exercised Options: $36,394,784
Current Obligation: $36,394,781
Subaward Activity
Number of Subawards: 7
Total Subaward Amount: $3,796,653
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA861119D2123
IDV Type: IDC
Timeline
Start Date: 2019-08-30
Current End Date: 2023-12-29
Potential End Date: 2023-12-29 00:00:00
Last Modified: 2025-01-08
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