DoD Awards $908M F-16 Aircraft Contract to Lockheed Martin, Lacking Competition
Contract Overview
Contract Amount: $907,819,438 ($907.8M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2005-12-27
End Date: 2016-01-31
Contract Duration: 3,687 days
Daily Burn Rate: $246.2K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: PEACE XENIA IV (GREECE) F-16 C/D BLOCK 52M AIRCRAFT, FERRY PREPARATION, AND ALTERNATE MISSION EQUIPMENT
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76108
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $907.8 million to LOCKHEED MARTIN CORPORATION for work described as: PEACE XENIA IV (GREECE) F-16 C/D BLOCK 52M AIRCRAFT, FERRY PREPARATION, AND ALTERNATE MISSION EQUIPMENT Key points: 1. Significant investment in advanced aircraft capabilities. 2. Sole reliance on Lockheed Martin raises concerns about market competition. 3. Long contract duration (over 10 years) may limit flexibility. 4. High value contract warrants close scrutiny of pricing and performance.
Value Assessment
Rating: questionable
The contract value of $908M for F-16 aircraft and related equipment is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to potential alternatives or previous procurements.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract is marked as 'NOT AVAILABLE FOR COMPETITION', indicating a limited or sole-source procurement. This significantly restricts price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition for such a large contract may result in taxpayers paying a premium for these aircraft and associated services.
Public Impact
Enhances Air Force's combat readiness with advanced F-16 capabilities. Supports a major defense contractor, potentially impacting jobs and the aerospace sector. Long-term commitment to specific aircraft technology may influence future modernization strategies.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- High contract value
- Long contract duration
Positive Signals
- Acquisition of advanced military hardware
- Potential for technological advancement in aircraft manufacturing
Sector Analysis
This contract falls within the Aircraft Manufacturing sector, a high-value industry often dominated by a few large prime contractors. Benchmarks for similar large-scale aircraft procurements are typically in the hundreds of millions to billions of dollars.
Small Business Impact
The data indicates the prime contractor is Lockheed Martin Corporation. There is no information provided regarding the involvement or subcontracting opportunities for small businesses in this specific contract.
Oversight & Accountability
The Department of Defense, specifically the Air Force, is the awarding agency. Oversight would typically involve program management reviews, contract performance monitoring, and potentially Inspector General audits, especially given the contract's value and duration.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for overpayment due to lack of competition.
- Risk of technological obsolescence over the contract's long duration.
- Limited transparency regarding specific contract line items and pricing.
- Dependency on a single contractor for critical defense assets.
Tags
aircraft-manufacturing, department-of-defense, tx, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $907.8 million to LOCKHEED MARTIN CORPORATION. PEACE XENIA IV (GREECE) F-16 C/D BLOCK 52M AIRCRAFT, FERRY PREPARATION, AND ALTERNATE MISSION EQUIPMENT
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 $907.8 million.
What is the period of performance?
Start: 2005-12-27. End: 2016-01-31.
What specific justifications were provided for limiting competition on this substantial F-16 procurement?
The justification for limiting competition is crucial for understanding the necessity of awarding this contract to a single provider. Without this information, it's difficult to ascertain if alternative solutions were explored or if unique technological requirements mandated this approach. Further investigation into the official justification documents is needed to assess the validity of the limited competition claim.
How does the unit cost of these F-16s compare to similar aircraft procured competitively by the US or allied nations?
A direct comparison of unit costs is challenging without detailed pricing breakdowns and specific configurations. However, given the lack of competition, there's a heightened risk that the per-unit cost may exceed benchmarks established through competitive processes. Benchmarking against publicly available data for similarly equipped F-16s or comparable fighter jets procured competitively would be essential for a thorough value assessment.
What are the long-term strategic implications of investing heavily in F-16s, particularly concerning future modernization and potential obsolescence?
The significant investment in F-16s, especially under a long-term contract, suggests a strategic reliance on this platform for a considerable period. This could impact the pace of adoption for next-generation fighter jets and potentially lead to higher sustainment costs if the F-16 platform becomes technologically outdated. Evaluating the planned service life and upgrade paths for these aircraft is key to understanding their long-term effectiveness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: LOCKHEED BLVD, FORT WORTH, TX, 76108
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $563,802,434
Exercised Options: $806,802,434
Current Obligation: $907,819,438
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2005-12-27
Current End Date: 2016-01-31
Potential End Date: 2016-01-31 00:00:00
Last Modified: 2018-07-27
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