New Zealand Acquires C-130J-30 Aircraft for $504M from Lockheed Martin
Contract Overview
Contract Amount: $503,935,487 ($503.9M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2020-10-14
End Date: 2026-12-31
Contract Duration: 2,269 days
Daily Burn Rate: $222.1K/day
Competition Type: NOT COMPETED
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: NEW ZEALAND C-130J-30 AIRCRAFT 6.0 BASELINE
Place of Performance
Location: MARIETTA, COBB County, GEORGIA, 30063
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $503.9 million to LOCKHEED MARTIN CORP for work described as: NEW ZEALAND C-130J-30 AIRCRAFT 6.0 BASELINE Key points: 1. Significant investment in strategic airlift capability. 2. Sole source procurement from Lockheed Martin raises competition concerns. 3. Long-term contract (2020-2026) with fixed-price incentive structure. 4. Aircraft manufacturing sector dominated by a few key players.
Value Assessment
Rating: fair
The contract value of $504M for six C-130J-30 aircraft appears high, especially given the lack of competition. Benchmarking against similar international sales or domestic procurements would be necessary for a precise assessment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was sole-sourced, meaning there was no competitive bidding process. This significantly limits price discovery and potentially leads to higher costs for the taxpayer.
Taxpayer Impact: The lack of competition in this sole-source procurement likely resulted in a higher price than could have been achieved through a competitive process, impacting taxpayer value.
Public Impact
Enhances New Zealand's military and humanitarian aid delivery capabilities. Supports long-term strategic defense partnerships. Potential for follow-on sustainment and upgrade contracts.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- High contract value
- Long contract duration
Positive Signals
- Acquisition of critical strategic asset
- Modernization of air transport fleet
Sector Analysis
The defense sector, particularly aircraft manufacturing, is characterized by high barriers to entry and significant technological investment. Major contracts like this are often awarded to established prime contractors like Lockheed Martin.
Small Business Impact
This contract was awarded to Lockheed Martin, a large prime contractor. There is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
Oversight of this sole-source contract should focus on ensuring fair pricing through robust negotiation and monitoring contract performance against established milestones and deliverables.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Long-term dependency on a single supplier
- Limited transparency in pricing
Tags
aircraft-manufacturing, department-of-defense, ga, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $503.9 million to LOCKHEED MARTIN CORP. NEW ZEALAND C-130J-30 AIRCRAFT 6.0 BASELINE
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 $503.9 million.
What is the period of performance?
Start: 2020-10-14. End: 2026-12-31.
What is the justification for the sole-source award of the C-130J-30 aircraft to Lockheed Martin?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of viable alternatives. Without further documentation, it's difficult to ascertain the specific reasons. However, the C-130J is a specialized aircraft, and Lockheed Martin is its sole manufacturer, which could be a primary driver for this procurement approach.
How does the per-unit cost compare to similar international procurements of the C-130J-30?
Benchmarking the per-unit cost is crucial for assessing value. While the total contract is $504M for six aircraft, the exact per-unit cost needs to be calculated and compared against publicly available data for other nations acquiring the same model. Variations in configuration, support packages, and timing of acquisition can influence these comparisons.
What are the potential risks associated with a long-term, fixed-price incentive contract for aircraft acquisition?
Fixed-price incentive contracts aim to share risk between the government and contractor. Risks include potential cost overruns if targets are missed, contractor performance issues impacting delivery schedules, and the need for diligent government oversight to manage incentive clauses effectively and ensure the government receives the best value.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIXED PRICE INCENTIVE (L)
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: $503,935,487
Exercised Options: $503,935,487
Current Obligation: $503,935,487
Subaward Activity
Number of Subawards: 785
Total Subaward Amount: $172,628,710
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA862520D3000
IDV Type: IDC
Timeline
Start Date: 2020-10-14
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2025-12-31
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