DoD's $40.8M Lockheed Martin Delivery Order for Air Transportation Support Lacks Competition
Contract Overview
Contract Amount: $40,850,890 ($40.9M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2022-05-27
End Date: 2027-02-28
Contract Duration: 1,738 days
Daily Burn Rate: $23.5K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Transportation
Official Description: RAPID DELIVERY ORDER 0007
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76108
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $40.9 million to LOCKHEED MARTIN CORPORATION for work described as: RAPID DELIVERY ORDER 0007 Key points: 1. Significant contract value of over $40 million. 2. Sole-source award to a major defense contractor, Lockheed Martin. 3. Potential for inflated costs due to lack of competitive bidding. 4. Contract falls under 'Other Support Activities for Air Transportation' sector.
Value Assessment
Rating: questionable
The contract is a Cost Plus Fixed Fee type, which can lead to higher costs if not carefully managed. Without competitive benchmarking, it's difficult to assess if the fixed fee and cost reimbursement are reasonable for the services provided.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers as there is no market pressure to drive down prices.
Taxpayer Impact: The lack of competition raises concerns about whether the government is receiving the best possible value for taxpayer dollars.
Public Impact
Taxpayers may be overpaying for essential air transportation support services. Limited transparency into the cost drivers for this specific support. Potential for reduced innovation if competitive pressures are absent.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Supports critical Air Force operations
- Long-term contract duration
Sector Analysis
This contract is in the 'Other Support Activities for Air Transportation' sector, which is crucial for military logistics and operations. Spending in this area can vary widely based on mission requirements and contractor capabilities.
Small Business Impact
The contract was awarded to Lockheed Martin Corporation, a large defense contractor. There is no indication that small businesses were involved as subcontractors or partners in this specific delivery order.
Oversight & Accountability
The sole-source nature of this award warrants close oversight from the Department of Defense to ensure cost reasonableness and effective performance. Robust auditing of costs and performance metrics is essential.
Related Government Programs
- Other Support Activities for Air Transportation
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency
- Sole-source award justification needed
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 $40.9 million to LOCKHEED MARTIN CORPORATION. RAPID DELIVERY ORDER 0007
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 $40.9 million.
What is the period of performance?
Start: 2022-05-27. End: 2027-02-28.
What specific justification was provided for awarding this contract on a sole-source basis, and how does it align with federal procurement regulations for non-competitive awards?
Federal procurement regulations allow for sole-source awards under specific circumstances, such as when only one responsible source can provide the required supplies or services. The justification would need to detail why competition was not feasible or not in the government's best interest. This could include unique capabilities, urgent needs, or lack of market availability. A thorough review of the justification is necessary to ensure compliance and prevent potential abuse.
How will the Department of Defense ensure cost control and value for money given the Cost Plus Fixed Fee structure and the absence of competition?
The Department of Defense can implement stringent cost monitoring, performance metrics, and regular audits to manage costs under a Cost Plus Fixed Fee contract. Establishing clear performance standards and incentivizing efficiency, even without direct price competition, is crucial. Independent cost estimates and benchmarking against similar, albeit potentially competed, contracts can also provide a basis for value assessment.
What are the potential long-term implications for the Air Force's operational readiness and budget if this sole-source arrangement continues without periodic re-evaluation?
Continuing a sole-source arrangement without re-evaluation risks escalating costs over time as the contractor faces no competitive pressure to innovate or reduce expenses. This could strain the Air Force's budget, potentially diverting funds from other critical areas. Furthermore, reliance on a single provider might limit access to newer technologies or more efficient solutions that could emerge from a competitive market, impacting long-term operational readiness.
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: $40,850,890
Exercised Options: $40,850,890
Current Obligation: $40,850,890
Subaward Activity
Number of Subawards: 2
Total Subaward Amount: $105,225
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: 2022-05-27
Current End Date: 2027-02-28
Potential End Date: 2027-02-28 00:00:00
Last Modified: 2025-08-28
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