DoD's $87.6M C-5 Mission Computer & Radar EMD Program Awarded to Lockheed Martin

Contract Overview

Contract Amount: $87,599,869 ($87.6M)

Contractor: Lockheed Martin Corp

Awarding Agency: Department of Defense

Start Date: 2014-02-26

End Date: 2017-03-24

Contract Duration: 1,122 days

Daily Burn Rate: $78.1K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: C-5 CORE MISSION COMPUTER AND COLOR WEATHER RADAR EMD PROGRAM

Place of Performance

Location: MARIETTA, COBB County, GEORGIA, 30063

State: Georgia Government Spending

Plain-Language Summary

Department of Defense obligated $87.6 million to LOCKHEED MARTIN CORP for work described as: C-5 CORE MISSION COMPUTER AND COLOR WEATHER RADAR EMD PROGRAM Key points: 1. The contract awarded to Lockheed Martin for the C-5 program represents a significant investment in critical aircraft systems. 2. While specific value-for-money metrics are not detailed, the cost-plus-fixed-fee structure suggests a focus on development and innovation. 3. The sole-source nature of this award warrants scrutiny regarding potential price inflation and limited market engagement. 4. Performance context is tied to the C-5's core mission capabilities, implying a direct impact on strategic airlift operations. 5. This contract falls within the broader Defense sector, specifically supporting aircraft modernization and sustainment. 6. The absence of competition raises questions about whether the government secured the best possible price and technological solution.

Value Assessment

Rating: fair

The contract's cost-plus-fixed-fee (CPFF) structure is common for research and development efforts where final costs are uncertain. However, without a competitive bidding process, it is difficult to benchmark the pricing against market rates or alternative solutions. The total award amount of approximately $87.6 million for an Engineering and Manufacturing Development (EMD) program suggests a substantial investment, but its value-for-money is inherently harder to assess without comparative data. The fixed fee component provides some cost control for the government, but the overall cost efficiency remains a point of consideration.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Lockheed Martin Corporation, was solicited. This approach is typically used when a specific contractor possesses unique capabilities, proprietary technology, or when the urgency of the requirement precludes a full and open competition. The lack of competition limits the government's ability to leverage market forces to drive down prices or explore a wider range of innovative solutions. It also means that the government did not benefit from the potential cost savings that can arise from multiple bidders vying for the contract.

Taxpayer Impact: The sole-source award means taxpayers may not have received the most competitive pricing. Without competition, there's a reduced incentive for the contractor to offer the lowest possible price, potentially leading to higher overall expenditure for the government.

Public Impact

The primary beneficiaries of this contract are the United States Air Force and its C-5 aircrews, who will receive upgraded mission computer and weather radar systems. The services delivered include the development and integration of new technologies to enhance the operational effectiveness and reliability of the C-5 Galaxy fleet. The geographic impact is primarily within the United States, supporting the operational readiness of a key strategic airlift asset. Workforce implications include employment for engineers, technicians, and support staff at Lockheed Martin and its subcontractors involved in the EMD phase.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and potential cost savings for taxpayers.
Cost-plus-fixed-fee contracts can sometimes lead to cost overruns if not closely managed.
Lack of transparency in the procurement process due to sole-source nature.
Reliance on a single contractor for critical system upgrades may pose long-term supply chain risks.

Positive Signals

Addresses critical mission needs for the C-5 Galaxy fleet, enhancing operational capabilities.
Focus on EMD suggests investment in advanced technology and future readiness.
Lockheed Martin's established expertise with the C-5 platform likely ensures a high degree of technical understanding.
Fixed fee component provides some level of cost predictability for the government.

Sector Analysis

The defense aerospace sector is characterized by high barriers to entry, significant R&D investment, and long-term sustainment contracts. This contract for the C-5 Mission Computer and Color Weather Radar EMD Program fits within the broader category of aircraft modernization and upgrade programs. The market for such specialized components is often dominated by a few large prime contractors like Lockheed Martin, who have established relationships and deep technical knowledge of specific platforms. Comparable spending benchmarks would typically involve other EMD programs for major aircraft systems, which can range from tens to hundreds of millions of dollars depending on complexity and scope.

Small Business Impact

This contract does not appear to have a small business set-aside component, as it was awarded to Lockheed Martin Corporation, a large prime contractor. The implications for small businesses would primarily be through potential subcontracting opportunities if Lockheed Martin chooses to engage them for specific parts of the development or manufacturing process. However, without a formal subcontracting plan requirement explicitly stated or a competitive bidding process that encourages small business participation, the direct impact on the small business ecosystem for this specific award is likely limited.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Defense's contract management agencies, such as the Defense Contract Management Agency (DCMA). Accountability measures are embedded within the Cost Plus Fixed Fee (CPFF) contract structure, which requires detailed cost reporting and progress tracking. Transparency is generally limited for sole-source awards, but contract modifications, performance reviews, and final delivery reports would be subject to internal DoD oversight. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

C-5 Galaxy Sustainment Programs
Avionics Modernization Programs
Military Aircraft Radar Systems
Mission Computer Development Contracts
Aerospace Engineering and Manufacturing Development

Risk Flags

Sole-source award
Lack of competitive benchmarking
Potential for cost growth in CPFF contracts

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $87.6 million to LOCKHEED MARTIN CORP. C-5 CORE MISSION COMPUTER AND COLOR WEATHER RADAR EMD PROGRAM

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORP.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $87.6 million.

What is the period of performance?

Start: 2014-02-26. End: 2017-03-24.

What is Lockheed Martin's track record with C-5 upgrades and similar avionics development programs?

Lockheed Martin has a long and extensive history with the C-5 Galaxy program, serving as the prime contractor for its development, production, and sustainment for decades. They have been responsible for numerous upgrades and modifications to the C-5 fleet over the years, including avionics modernization efforts. Their track record includes delivering complex systems integration for large military aircraft. For instance, they led the C-5 Reliability Enhancement and Re-engining Program (RERP), which significantly improved the aircraft's performance and lifespan. This deep institutional knowledge and experience with the C-5 platform position them as a logical, albeit sole-source, provider for further critical system upgrades like the mission computer and radar EMD.

How does the $87.6 million cost compare to similar EMD programs for military aircraft systems?

Benchmarking the $87.6 million cost for this C-5 Mission Computer and Color Weather Radar EMD program against similar Engineering and Manufacturing Development (EMD) efforts requires careful consideration of program scope, technological complexity, and aircraft platform. EMD programs for major avionics suites or critical system upgrades on large military aircraft can vary widely. For example, EMD phases for new fighter jet avionics or upgrades to bomber systems can easily run into hundreds of millions of dollars. Given that this contract focuses on specific core systems (mission computer and radar) for an existing, albeit large, platform like the C-5, $87.6 million appears to be within a reasonable range for an EMD phase, particularly if it involves significant technological advancement and integration challenges. However, without detailed cost breakdowns and scope comparisons, a precise value-for-money assessment is challenging.

What are the primary risks associated with a sole-source award for this type of development program?

The primary risks associated with a sole-source award for this development program include potential lack of price competition, leading to higher costs for the government than might be achieved through a competitive process. There's also a risk of reduced innovation, as the absence of competing proposals may lessen the incentive for the sole contractor to explore novel or more cost-effective solutions. Furthermore, sole-source contracts can sometimes indicate a lack of available qualified sources or a perception of unique capabilities, which, if inaccurate, could mean the government is not leveraging the broader market. Finally, there's a potential for contractor complacency or less rigorous performance management if the contractor perceives limited risk of losing future business to competitors.

How will the success of this EMD program impact the operational effectiveness of the C-5 fleet?

The success of this Engineering and Manufacturing Development (EMD) program is critical for maintaining and enhancing the operational effectiveness of the C-5 Galaxy fleet. The mission computer is the central processing unit for the aircraft, managing navigation, flight control, and various other operational functions. An upgraded mission computer can lead to improved situational awareness, enhanced navigation accuracy, and better integration of new mission systems. Similarly, an advanced color weather radar system provides pilots with more precise and timely information about weather conditions, enabling safer flight planning and execution, especially during long-range strategic airlift missions. Successful development and integration of these systems will ensure the C-5 remains a capable and reliable asset for global military logistics.

What has been the historical spending trend for C-5 mission computer and radar system upgrades prior to this contract?

Historical spending on C-5 mission computer and radar system upgrades prior to this specific $87.6 million EMD contract would likely show a pattern of incremental improvements and sustainment activities rather than large-scale EMD programs for these core components in recent years. The C-5 has undergone various modernization efforts over its lifespan, such as the Avionics Modernization Program (AMP) and the Reliability Enhancement and Re-engining Program (RERP). These programs involved significant investments, but the focus here is specifically on the EMD phase for a new generation of mission computer and color weather radar. Previous spending might have been on sustainment contracts for existing systems or smaller upgrade packages. Quantifying precise historical spending solely on these two components' EMD phases is difficult without access to detailed program histories, but it's probable that this contract represents a significant, targeted investment in next-generation capabilities for these critical systems.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: COST PLUS FIXED FEE (U)

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: $88,042,022

Exercised Options: $88,042,022

Current Obligation: $87,599,869

Actual Outlays: $147,160

Subaward Activity

Number of Subawards: 15

Total Subaward Amount: $25,426,560

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline