Lockheed Martin awarded $11.9M for missile and space vehicle parts, with no competition

Contract Overview

Contract Amount: $11,907,433 ($11.9M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2025-12-21

End Date: 2025-12-21

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: REPAIRS OF AUR, MAJOR AND MINOR CONTAINER AND FIELD REPAIRS. IN ADDITION, THIS EFFORT INCLUDES GOVERNMENT FURNISHED MATERIAL (GFM) MANAGEMENT OF SPARES CONSISTING OF MANAGEMENT, CONTROL, FORECASTING REQUIREMENTS, PROCUREMENT AND REPAIR/DISPOSAL.

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $11.9 million to LOCKHEED MARTIN CORPORATION for work described as: REPAIRS OF AUR, MAJOR AND MINOR CONTAINER AND FIELD REPAIRS. IN ADDITION, THIS EFFORT INCLUDES GOVERNMENT FURNISHED MATERIAL (GFM) MANAGEMENT OF SPARES CONSISTING OF MANAGEMENT, CONTROL, FORECASTING REQUIREMENTS, PROCUREMENT AND REPAIR/DISPOSAL. Key points: 1. Contract focuses on critical repairs and GFM management for missile and space vehicles. 2. Sole-source award raises questions about potential overpricing and lack of market pressure. 3. Limited competition may indicate specialized capabilities required, but warrants further scrutiny. 4. Performance period is relatively short, suggesting a focused scope of work. 5. The contract falls under the 'Other Guided Missile and Space Vehicle Parts' manufacturing NAICS code. 6. No small business set-aside was applied, indicating potential missed opportunities for smaller firms.

Value Assessment

Rating: questionable

Without a competitive bidding process, it is difficult to benchmark the value for money. The Cost Plus Fixed Fee (CPFF) contract type can sometimes lead to higher costs if not managed closely, as the contractor is reimbursed for allowable costs plus a fixed fee. Comparing this to similar sole-source contracts for specialized aerospace components would be necessary to assess pricing reasonableness. The absence of competition limits the ability to determine if the fixed fee adequately incentivizes efficiency.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one contractor was solicited. This typically occurs when a unique capability or proprietary technology is required, or in cases of urgent need where only one source can reasonably fulfill the requirement. The lack of competition means there was no opportunity for multiple bidders to offer proposals, which can limit price discovery and potentially lead to higher costs for the government.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without competing bids, the government has less leverage to negotiate the lowest possible price for these essential repair and management services.

Public Impact

The primary beneficiaries are the Department of the Air Force, ensuring the operational readiness of critical missile and space vehicle systems. Services include major and minor repairs, as well as comprehensive Government Furnished Material (GFM) management, encompassing spares procurement, control, and disposal. The contract's geographic impact is focused on Florida, where the repairs and management activities will likely take place. Workforce implications include the potential for skilled technicians and logistics personnel employed by Lockheed Martin and its subcontractors in Florida.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price competition and may result in higher costs.
CPFF contract type requires diligent oversight to control costs and ensure fair pricing.
Lack of small business participation noted; potential for missed subcontracting opportunities.
Absence of clear performance metrics in the provided data makes assessing efficiency difficult.

Positive Signals

Focus on critical repairs ensures operational readiness of vital defense assets.
GFM management indicates a comprehensive approach to logistics and supply chain for complex systems.
Lockheed Martin is a recognized leader in aerospace and defense, suggesting technical expertise.
Contract award supports specialized manufacturing and repair capabilities within the defense industrial base.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on guided missile and space vehicle parts. The market for such specialized components and repair services is characterized by high barriers to entry due to technological complexity and stringent quality requirements. Spending in this area is driven by national security needs and the lifecycle support of advanced military platforms. Comparable spending benchmarks would involve analyzing other sole-source or limited-competition contracts for similar high-value, specialized aerospace components and maintenance services.

Small Business Impact

This contract was not set aside for small businesses, nor does it appear to have specific subcontracting requirements mentioned in the provided data. This suggests that the primary contractor, Lockheed Martin, will likely perform the majority of the work. The absence of a small business set-aside means that opportunities for smaller, specialized firms to participate in this specific contract are limited, potentially impacting the broader small business ecosystem within this niche of the defense industry.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Air Force contracting and program management offices. Given the Cost Plus Fixed Fee structure, rigorous financial oversight and auditing of allowable costs will be crucial. Transparency may be limited due to the sole-source nature, but contract performance reviews and milestone tracking should be standard accountability measures. The Inspector General's office for the Department of Defense would have jurisdiction for audits and investigations if any irregularities were suspected.

Related Government Programs

Missile Systems Support Contracts
Aerospace Component Manufacturing
Government Furnished Material Management
Defense Logistics and Sustainment
Space Vehicle Maintenance

Risk Flags

Sole-source award
Cost Plus Fixed Fee contract type
Lack of competition
Potential for cost overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $11.9 million to LOCKHEED MARTIN CORPORATION. REPAIRS OF AUR, MAJOR AND MINOR CONTAINER AND FIELD REPAIRS. IN ADDITION, THIS EFFORT INCLUDES GOVERNMENT FURNISHED MATERIAL (GFM) MANAGEMENT OF SPARES CONSISTING OF MANAGEMENT, CONTROL, FORECASTING REQUIREMENTS, PROCUREMENT AND REPAIR/DISPOSAL.

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 $11.9 million.

What is the period of performance?

Start: 2025-12-21. End: 2025-12-21.

What is Lockheed Martin's track record with similar sole-source contracts for missile and space vehicle parts?

Lockheed Martin Corporation is a major defense contractor with extensive experience in sole-source and limited-competition contracts, particularly for complex aerospace and defense systems. Their track record often involves highly specialized components and integrated systems where they possess unique intellectual property or manufacturing capabilities. While this expertise is valuable, sole-source awards necessitate robust government oversight to ensure fair pricing and prevent cost overruns. Historical data on their performance in similar contracts would reveal patterns in cost control, delivery timeliness, and overall program success. Analyzing past sole-source awards to Lockheed Martin in this specific sub-sector could provide insights into their pricing strategies and the government's effectiveness in managing such contracts.

How does the Cost Plus Fixed Fee (CPFF) contract type impact value for money in this specific context?

The CPFF contract type reimburses the contractor for all allowable costs incurred, plus a predetermined fixed fee representing profit. This structure is often used when the scope of work is not precisely defined or involves inherent uncertainties, such as research and development or complex repairs. For value for money, the key lies in the government's ability to accurately estimate costs and effectively manage the contractor's expenditures. A well-defined fixed fee should incentivize the contractor to control costs to maximize their profit margin. However, without strong government oversight, there's a risk that costs could escalate, and the fixed fee might not adequately reflect the value delivered. Benchmarking the fee against industry standards for similar work is crucial for assessing fairness.

What are the primary risks associated with a sole-source award for critical defense components?

The primary risks associated with a sole-source award for critical defense components include a lack of price competition, potentially leading to inflated costs for the government. Without multiple bids, there is less incentive for the contractor to offer the most competitive pricing. Another risk is reduced innovation, as the absence of competition can lessen the pressure to develop more efficient or cost-effective solutions. Furthermore, sole-source awards can create vendor lock-in, making it difficult and costly to switch providers in the future. There's also a heightened need for stringent government oversight to ensure the contractor is performing efficiently and not exploiting their独占 position.

What is the historical spending pattern for 'Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing' (NAICS 336419) by the Department of the Air Force?

Historical spending data for NAICS 336419 by the Department of the Air Force would reveal trends in procurement for specialized parts and auxiliary equipment related to guided missiles and space vehicles. Analyzing this data over several fiscal years would indicate the overall investment in this sub-sector, identify major contractors, and highlight the prevalence of competitive versus sole-source awards. Significant year-over-year increases or decreases could signal shifts in program priorities, technological advancements, or sustainment needs for existing fleets. Understanding this historical context is vital for assessing whether the current $11.9 million award is consistent with past spending levels or represents an anomaly, and whether the reliance on sole-source contracts in this category is a persistent trend.

Are there any specific performance metrics or Key Performance Indicators (KPIs) associated with this contract?

The provided data does not explicitly list specific performance metrics or Key Performance Indicators (KPIs) for this contract. However, for a contract involving repairs and GFM management of critical defense assets, typical KPIs would likely include on-time delivery of repairs, adherence to quality standards (e.g., defect rates), efficiency in GFM inventory management (e.g., stock-out rates, inventory turnover), and cost control within the agreed-upon budget. The CPFF structure necessitates close monitoring of cost performance. Without defined KPIs, assessing the contractor's efficiency and the overall success of the contract becomes more challenging, relying heavily on qualitative assessments and milestone achievement.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing

Product/Service Code: GUIDED MISSLES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 5600 W SAND LAKE RD # MP-265, ORLANDO, FL, 32819

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: $55,010,926

Exercised Options: $18,892,297

Current Obligation: $11,907,433

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA868222DB001

IDV Type: IDC

Timeline