Air Force Awards $80.9M Lockheed Martin Contract for DMSMS Refresh to Resolve Component Obsolescence
Contract Overview
Contract Amount: $80,913,929 ($80.9M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2024-09-26
End Date: 2027-11-30
Contract Duration: 1,160 days
Daily Burn Rate: $69.8K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: CONTRACTOR TO PERFORM A DMSMS REFRESH TO RESOLVE SUB-COMPONENT OBSOLESCENCE WITHIN THE IFF, GALLEY COLD BOX STORAGE UNIT, MILACAS-XR TCAS 7.1, EMMU/ DSDTS/ RMM, AND PMD LRUS.
Place of Performance
Location: MARIETTA, COBB County, GEORGIA, 30063
State: Georgia Government Spending
Plain-Language Summary
Department of Defense obligated $80.9 million to LOCKHEED MARTIN CORP for work described as: CONTRACTOR TO PERFORM A DMSMS REFRESH TO RESOLVE SUB-COMPONENT OBSOLESCENCE WITHIN THE IFF, GALLEY COLD BOX STORAGE UNIT, MILACAS-XR TCAS 7.1, EMMU/ DSDTS/ RMM, AND PMD LRUS. Key points: 1. Contract addresses critical component obsolescence in aircraft systems. 2. Lockheed Martin, a major defense contractor, is the sole awardee. 3. Potential risks include cost overruns due to fixed-fee structure and sole-source nature. 4. Spending falls within the Aircraft Manufacturing sector.
Value Assessment
Rating: fair
The contract is a Cost Plus Fixed Fee type, which can lead to cost overruns if not managed carefully. The awarded amount of $80.9M for a 1160-day duration needs further benchmarking against similar obsolescence resolution efforts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for this critical obsolescence refresh may result in a higher overall cost to taxpayers.
Public Impact
Ensures continued operational readiness of Air Force aircraft by addressing aging components. Supports the sustainment of critical defense systems through proactive obsolescence management. Potential for extended aircraft service life due to resolved component issues.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award limits competition and price discovery.
- Cost Plus Fixed Fee contract type carries inherent cost overrun risk.
- Obsolescence resolution can be complex and unpredictable, impacting final costs.
Positive Signals
- Addresses critical component obsolescence, ensuring system functionality.
- Supports long-term sustainment of vital Air Force assets.
- Awarded to a known, experienced defense contractor.
Sector Analysis
This contract falls under the Aircraft Manufacturing sector, specifically addressing sustainment and modernization needs. Spending benchmarks for DMSMS refreshes can vary significantly based on system complexity and the extent of obsolescence.
Small Business Impact
The awardee, Lockheed Martin Corp, is a large business. There is no indication that small businesses were involved in this specific sole-source contract, missing an opportunity for their participation.
Oversight & Accountability
The Department of the Air Force is responsible for oversight. Given the sole-source nature and cost-plus contract type, robust oversight will be crucial to manage costs and ensure effective resolution of obsolescence issues.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Lack of Competition
- Cost Overrun Potential (CPFF)
- Obsolescence Resolution Complexity
- Sole-Source Justification Scrutiny
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 $80.9 million to LOCKHEED MARTIN CORP. CONTRACTOR TO PERFORM A DMSMS REFRESH TO RESOLVE SUB-COMPONENT OBSOLESCENCE WITHIN THE IFF, GALLEY COLD BOX STORAGE UNIT, MILACAS-XR TCAS 7.1, EMMU/ DSDTS/ RMM, AND PMD LRUS.
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 $80.9 million.
What is the period of performance?
Start: 2024-09-26. End: 2027-11-30.
What is the estimated cost savings or operational benefit achieved by performing this DMSMS refresh compared to alternative solutions like system replacement?
Quantifying the precise cost savings or operational benefits of this DMSMS refresh requires a detailed analysis comparing the current approach against alternatives such as full system replacement or redesign. Factors to consider include the lifespan extension of existing platforms, reduced maintenance costs due to new components, and the avoidance of procurement costs for entirely new systems. Without this comparative data, the true value proposition remains partially obscured.
What specific risks were identified that necessitated a sole-source award, and how are these risks being mitigated to prevent cost overruns?
The justification for a sole-source award typically stems from unique technical requirements, proprietary technology, or the unavailability of alternative sources. Mitigation strategies for cost overruns in a Cost Plus Fixed Fee contract include stringent contract surveillance, detailed cost tracking, performance metrics, and regular reviews of contractor expenditures. The Air Force must actively manage these elements to ensure the project stays within budget and achieves its objectives.
How will the effectiveness of the DMSMS refresh be measured to ensure the long-term reliability and performance of the affected aircraft components?
Effectiveness will be measured through a combination of post-implementation testing, performance monitoring, and reliability assessments. This includes verifying that the new components meet or exceed original specifications, tracking failure rates of refreshed systems, and assessing the overall impact on aircraft availability and mission readiness. Establishing clear Key Performance Indicators (KPIs) before contract execution is vital for objective evaluation.
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: 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: $80,913,929
Exercised Options: $80,913,929
Current Obligation: $80,913,929
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: 2024-09-26
Current End Date: 2027-11-30
Potential End Date: 2027-11-30 00:00:00
Last Modified: 2025-04-26
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