DoD awards $47.3M contract to Lockheed Martin for A-10 aircraft parts, raising competition concerns
Contract Overview
Contract Amount: $47,294,223 ($47.3M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2006-08-24
End Date: 2009-07-28
Contract Duration: 1,069 days
Daily Burn Rate: $44.2K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: 200611!000021!5700!FA8635!A-10SS/PM !FA863506C6030 !A!N! !N! ! !20060824!20070706!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE ROUTE 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOGA !NEW YORK !+000017029000!N!N!000036000000!1510!AIRCRAFT FIXED WING !A1C!OTHER AIRCRAFT EQUIPMENT !166 !NAVSTAR GPS !336413!E! !1! ! ! ! ! !99990909!B! ! !A! !D!N!V!1!001!N!1G!A!Y!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!B!N! ! ! !Y! ! !0001! !
Place of Performance
Location: OWEGO, TIOGA County, NEW YORK, 13827
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $47.3 million to LOCKHEED MARTIN CORPORATION for work described as: 200611!000021!5700!FA8635!A-10SS/PM !FA863506C6030 !A!N! !N! ! !20060824!20070706!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE ROUTE 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOG… Key points: 1. Significant award to a single large defense contractor. 2. Lack of competition raises questions about price discovery. 3. Contract type (CPIF) may incentivize cost overruns. 4. Focus on specific aircraft parts suggests niche market.
Value Assessment
Rating: questionable
The contract value of $47.3M for aircraft parts appears high given the 'NOT COMPETED' status. Benchmarking against similar sole-source contracts for specialized aircraft components is crucial to assess value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded sole-source, meaning there was no competition. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition likely results in a higher price than if multiple vendors had bid, impacting taxpayer funds negatively.
Public Impact
Taxpayers may be overpaying for critical aircraft components due to lack of competition. Reliance on a single supplier can create supply chain vulnerabilities for the A-10 fleet. The award highlights potential for non-competitive awards in specialized defense manufacturing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost Plus Incentive Fee contract type
- Lack of transparency in pricing
Positive Signals
- Supports critical defense platform (A-10)
- Award to established defense contractor
Sector Analysis
This contract falls within the aerospace and defense sector, specifically focusing on aircraft parts. Spending in this area is often characterized by high R&D costs, specialized manufacturing, and significant government oversight due to national security implications.
Small Business Impact
The award went to Lockheed Martin Corporation, a large prime contractor. There is no indication that small businesses were involved as subcontractors or prime contractors in this specific award, which is common for large sole-source defense contracts.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure fair pricing and prevent potential waste. The Defense Contract Management Agency (DCMA) is responsible for oversight, but the lack of competition limits their leverage on price.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Potential for inflated pricing
- Limited oversight leverage on price
- Dependency on a single supplier
- Cost-plus contract type risks
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, ny, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $47.3 million to LOCKHEED MARTIN CORPORATION. 200611!000021!5700!FA8635!A-10SS/PM !FA863506C6030 !A!N! !N! ! !20060824!20070706!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE ROUTE 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOGA !NEW YORK !+000017029000!N!N!000036000000!1510!AIRCRAFT FIXED WING !A1C!OTHER AIRCRAFT EQUIPMENT !166 !NAVSTAR GPS !336413!E! !1! ! ! ! ! !999
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $47.3 million.
What is the period of performance?
Start: 2006-08-24. End: 2009-07-28.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves factors like unique capabilities, urgent need, or lack of viable alternatives. Without further details, it's difficult to assess if alternative competitive strategies were thoroughly explored. A review of the contract file and justification documents would be necessary to determine the rationale and the extent of market research conducted.
How does the Cost Plus Incentive Fee (CPIF) structure impact cost control for these aircraft parts?
A CPIF contract aims to incentivize the contractor to control costs by sharing savings or overruns with the government. However, it can also encourage higher initial cost estimates to maximize potential profit. The effectiveness depends heavily on the realism of the target cost and the incentive sharing formula, requiring diligent government oversight to ensure it truly benefits the taxpayer.
What is the long-term strategic impact of awarding this contract solely to Lockheed Martin for A-10 parts?
Sole-source awards can reduce competition and potentially increase long-term costs for sustainment. It also creates a dependency on a single supplier, which can pose risks to the supply chain's resilience and flexibility. While it ensures a known entity is producing the parts, it may stifle innovation and limit options for future upgrades or cost-saving measures.
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 INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 1801 STATE ROUTE 17C, OWEGO, NY, 13827
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2006-08-24
Current End Date: 2009-07-28
Potential End Date: 2009-07-28 00:00:00
Last Modified: 2025-06-05
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