Lockheed Martin awarded $13.3M for R&D, with 3 offers received in a full and open competition
Contract Overview
Contract Amount: $13,296,231 ($13.3M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2018-11-14
End Date: 2026-03-31
Contract Duration: 2,694 days
Daily Burn Rate: $4.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IGF::OT::IGF LOCKHEED DEMONSTRATION INCLUDING ENGINE (BLONDIE)
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76108
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $13.3 million to LOCKHEED MARTIN CORPORATION for work described as: IGF::OT::IGF LOCKHEED DEMONSTRATION INCLUDING ENGINE (BLONDIE) Key points: 1. The contract value of $13.3 million for research and development appears reasonable given the scope of advanced technology demonstration. 2. Full and open competition with three bidders suggests a healthy market for this specialized R&D service. 3. The contract duration of nearly 7.5 years indicates a long-term research objective. 4. The cost-plus-fixed-fee pricing structure is common for R&D where exact costs are uncertain. 5. The primary performance location in Texas may have implications for regional economic impact. 6. This contract falls under the 'Research and Development in the Physical, Engineering, and Life Sciences' NAICS code.
Value Assessment
Rating: good
The $13.3 million award for a multi-year R&D effort is within a typical range for advanced technology demonstrations. Benchmarking against similar contracts for complex research projects indicates that the overall value is competitive. The cost-plus-fixed-fee structure, while allowing for flexibility, necessitates careful oversight to ensure costs remain controlled and the fixed fee is justified by the complexity and risk involved.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
This contract was awarded under full and open competition, with three distinct offers received. This level of competition is positive, indicating that multiple capable contractors vied for the work. The presence of three bidders suggests that the market is sufficiently robust to support competitive bidding for this type of specialized research and development, which generally leads to better price discovery and potentially more innovative solutions.
Taxpayer Impact: The full and open competition ensures that taxpayer dollars are being used efficiently by driving down costs through market forces and encouraging multiple companies to propose their best solutions.
Public Impact
The primary beneficiary is the Department of Defense, specifically the Air Force, which will receive advanced technology demonstrations. The services delivered are focused on research and development in physical, engineering, and life sciences, likely contributing to future defense capabilities. The geographic impact is concentrated in Texas, where the contract will be performed. Workforce implications include employment for highly skilled researchers, engineers, and technicians at Lockheed Martin and potentially its subcontractors.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus-fixed-fee contracts require diligent oversight to prevent cost overruns and ensure the fixed fee remains appropriate for the work performed.
- The long contract duration (nearly 7.5 years) necessitates sustained monitoring to ensure progress and adapt to evolving research needs.
- The specialized nature of the R&D may limit the pool of potential future contractors if the technology becomes highly proprietary.
Positive Signals
- Awarded under full and open competition, indicating a competitive marketplace for this technology.
- The contract involves advanced research and development, potentially leading to significant technological advancements for national security.
- The prime contractor, Lockheed Martin, has a strong track record in defense R&D and complex system integration.
Sector Analysis
This contract falls within the Research and Development (R&D) sector, specifically focusing on physical, engineering, and life sciences. The R&D market within the defense industry is characterized by significant investment in innovation to maintain technological superiority. Comparable spending benchmarks for advanced technology demonstrations of this nature can vary widely, but contracts in the hundreds of millions are common for larger programs, making this $13.3 million award a focused, specific project.
Small Business Impact
There is no indication of a small business set-aside for this contract, as it was awarded under full and open competition. Lockheed Martin, the prime contractor, is a large aerospace and defense company. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in the provided data. The impact on the small business ecosystem is likely indirect, depending on whether Lockheed Martin engages small businesses for specialized components or services.
Oversight & Accountability
Oversight for this contract will primarily be managed by the Department of the Air Force, a component of the Department of Defense. Accountability measures will be tied to the cost-plus-fixed-fee structure, requiring detailed reporting on costs incurred and progress made towards research objectives. Transparency is facilitated through the contract award process and reporting requirements, though specific details of the R&D may be sensitive. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Advanced Technology Demonstration Contracts
- Research and Development Services
- Aerospace and Defense R&D
- Department of the Air Force Research Programs
Risk Flags
- Cost Overrun Risk (CPFF)
- Long-Term Project Management
- Technological Obsolescence
Tags
research-and-development, department-of-defense, department-of-the-air-force, lockheed-martin-corporation, cost-plus-fixed-fee, full-and-open-competition, technology-demonstration, physical-engineering-life-sciences, texas, long-term-contract
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $13.3 million to LOCKHEED MARTIN CORPORATION. IGF::OT::IGF LOCKHEED DEMONSTRATION INCLUDING ENGINE (BLONDIE)
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
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 $13.3 million.
What is the period of performance?
Start: 2018-11-14. End: 2026-03-31.
What is Lockheed Martin's track record with similar R&D contracts for the Department of Defense?
Lockheed Martin has an extensive and well-documented track record with the Department of Defense (DoD) for research and development contracts across various domains, including aerospace, defense systems, and advanced technologies. They are consistently among the top DoD contractors, frequently awarded large-scale R&D efforts. Their history includes numerous successful demonstrations and developments of complex systems, often involving cutting-edge technologies. While specific performance metrics for past R&D contracts are not publicly detailed in aggregate, their continued success in securing competitive awards suggests a strong performance history and a high degree of confidence from the DoD in their capabilities to execute complex research objectives and deliver innovative solutions.
How does the $13.3 million value compare to similar R&D efforts in the physical and engineering sciences?
The $13.3 million value for this specific R&D contract, designated for 'Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)', is on the lower end for major defense R&D initiatives but is reasonable for a focused demonstration project. Larger, more comprehensive R&D programs can easily reach hundreds of millions or even billions of dollars. However, for specific technology demonstrations, prototype development, or feasibility studies within these broad categories, a $13.3 million award over several years is not uncommon. Benchmarking requires detailed analysis of the specific technological area, the maturity of the research, and the expected deliverables, but this figure suggests a project with a defined scope rather than a broad, multi-year foundational research effort.
What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D?
The primary risks associated with a Cost Plus Fixed Fee (CPFF) contract for R&D, like the one awarded to Lockheed Martin, center on cost control and contractor incentive. For the government, the risk is that the contractor may not be sufficiently incentivized to control costs, as the government ultimately bears the allowable costs incurred. If the initial cost estimates are inaccurate or if unforeseen technical challenges arise, costs can escalate beyond initial projections. For the contractor, the risk lies in accurately estimating the costs to ensure the fixed fee adequately compensates them for their effort and risk, especially if they underestimate the complexity or duration of the R&D. Effective oversight, detailed cost tracking, and clear performance metrics are crucial to mitigate these risks for both parties.
What is the significance of the contract duration of nearly 7.5 years?
The contract duration of approximately 2,694 days (nearly 7.5 years) is significant as it indicates a long-term commitment to a specific research and development objective. Such extended timelines are typical for complex R&D projects that require iterative development, testing, and refinement of advanced technologies. This duration suggests that the project is not a short-term feasibility study but rather aims to mature a technology or develop a system through multiple phases. It implies a strategic investment by the Air Force in achieving a specific technological capability that will likely take considerable time to realize. The extended period also necessitates robust program management to ensure milestones are met and the project remains aligned with evolving strategic needs.
How does the NAICS code 541712 (Research and Development in the Physical, Engineering, and Life Sciences) inform our understanding of this contract?
The North American Industry Classification System (NAICS) code 541712 provides critical context for this contract. It signifies that the core activity is scientific and technical research and development conducted by establishments primarily engaged in basic research, applied research, and experimental development in the physical, engineering, and life sciences. This excludes R&D in biotechnology (which has its own code) and R&D conducted by establishments primarily engaged in manufacturing, which would fall under their respective manufacturing NAICS codes. Understanding this code helps categorize the contract within the broader federal spending landscape, highlighting its focus on innovation and scientific advancement rather than production or service delivery. It also aids in identifying comparable contracts and understanding the market dynamics within this specific R&D sub-sector.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 3
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 1 LOCKHEED BLVD BLDG 10, FORT WORTH, TX, 76108
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: $22,117,782
Exercised Options: $22,117,782
Current Obligation: $13,296,231
Subaward Activity
Number of Subawards: 10
Total Subaward Amount: $3,934,049
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: FA865017D2405
IDV Type: IDC
Timeline
Start Date: 2018-11-14
Current End Date: 2026-03-31
Potential End Date: 2026-03-31 00:00:00
Last Modified: 2026-01-12
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