DoD Awards $60M Lockheed Martin C-130J Upgrade, Lacking Competition
Contract Overview
Contract Amount: $60,001,680 ($60.0M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2024-12-30
End Date: 2025-12-19
Contract Duration: 354 days
Daily Burn Rate: $169.5K/day
Competition Type: NOT COMPETED
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: FOREIGN MILITARY SALES C-130J CAPABILITY MANAGEMENT UPDATE 2 BLOCK UPGRADE 8.1.2
Place of Performance
Location: MARIETTA, COBB County, GEORGIA, 30063
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $60.0 million to LOCKHEED MARTIN CORP for work described as: FOREIGN MILITARY SALES C-130J CAPABILITY MANAGEMENT UPDATE 2 BLOCK UPGRADE 8.1.2 Key points: 1. Significant contract value for aircraft modernization. 2. Sole-source award to Lockheed Martin raises competition concerns. 3. Potential for higher costs due to limited price discovery. 4. Focus on critical aircraft capability upgrades for foreign allies.
Value Assessment
Rating: fair
The $60M award for C-130J upgrades is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market alternatives or previous similar upgrades.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Lockheed Martin. This limits price discovery and may result in less favorable terms for the government.
Taxpayer Impact: Taxpayer funds are used for foreign military sales, impacting the overall defense budget and potentially reducing funds available for domestic priorities.
Public Impact
Enhances capabilities of allied air forces, strengthening international partnerships. Supports the sustainment and modernization of a key military transport aircraft. Potential for increased operational readiness for partner nations.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for cost overruns
Positive Signals
- Critical capability upgrade
- Strengthens alliances
- Modernizes key aircraft
Sector Analysis
This contract falls within the aerospace and defense sector, specifically aircraft manufacturing and upgrades. Spending benchmarks for similar sole-source upgrade contracts can vary widely based on complexity and scope.
Small Business Impact
The contract was awarded to Lockheed Martin, a large prime contractor. There is no indication of subcontracting opportunities for small businesses in the provided data.
Oversight & Accountability
Oversight is crucial for sole-source contracts to ensure fair pricing and effective execution. The Department of the Air Force is responsible for managing this award.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of competitive bidding
- Sole-source award to incumbent
- Potential for price escalation
- Limited transparency in pricing
- Dependency on a single supplier
Tags
aircraft-manufacturing, department-of-defense, ga, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $60.0 million to LOCKHEED MARTIN CORP. FOREIGN MILITARY SALES C-130J CAPABILITY MANAGEMENT UPDATE 2 BLOCK UPGRADE 8.1.2
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 $60.0 million.
What is the period of performance?
Start: 2024-12-30. End: 2025-12-19.
What is the justification for the sole-source award, and what steps are being taken to ensure fair and reasonable pricing?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. To ensure fair and reasonable pricing, the contracting officer should conduct a thorough price analysis, potentially using historical data, cost breakdowns, or independent government cost estimates. Regular reviews and audits are also essential.
What are the specific risks associated with a sole-source award for this C-130J upgrade?
The primary risk of a sole-source award is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. There's also a risk that the contractor may not prioritize efficiency or quality as highly as they would in a competitive environment. Furthermore, reliance on a single source can create vulnerabilities if that source faces production issues or financial instability.
How will the effectiveness of this upgrade be measured, particularly given the lack of competitive benchmarking?
Effectiveness will be measured against predefined performance metrics and technical specifications outlined in the contract. This includes assessing the successful integration of Block Upgrade 8.1.2, improved system performance, and enhanced operational capabilities for the C-130J aircraft. User feedback from the recipient foreign military services will also be a key indicator of success.
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: $60,001,680
Exercised Options: $60,001,680
Current Obligation: $60,001,680
Subaward Activity
Number of Subawards: 11
Total Subaward Amount: $25,081,831
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: 2024-12-30
Current End Date: 2025-12-19
Potential End Date: 2025-12-19 00:00:00
Last Modified: 2026-01-05
More Contracts from Lockheed Martin Corp
- Federal Contract — $48.1B (Department of Energy)
- TAS::80 0124::TAS Design, Development, Test&evaluation of Project Orion — $15.5B (National Aeronautics and Space Administration)
- 200207!000021!5700!CZ62 !smc/Pkj LOS Angeles AFB !F0470102C0002 !A!N! !N! !20011116!20070630!872978978!196596688!834951691!n!lockheed Martin Corporation !1111 Lockheed Martin WAY !sunnyvale !ca!94089!77000!085!06!sunnyvale !santa Clara !california!+000012250000!n!n!000000000000!ar92!rdte/Space - Other - Applied Research !A2 !missile and Space Systems !3gfk!milstar !541710!E! !1! ! ! ! ! !99990909!B! ! !B! !d!n!j!2!001!n!2a!z!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! — $9.0B (Department of Defense)
- Next Generation Overhead Persistent Infrared Geosynchronous Earth Orbit Space Vehicle 1-3 Phase 1 — $7.3B (Department of Defense)
- Federal Contract — $7.3B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)