DoD awards $46M RDT&E contract to Lockheed Martin for physical science research, with a 960-day duration

Contract Overview

Contract Amount: $45,966,591 ($46.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2023-09-13

End Date: 2026-04-30

Contract Duration: 960 days

Daily Burn Rate: $47.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 6

Pricing Type: COST PLUS FIXED FEE

Sector: R&D

Official Description: ABAD PHASE 1 RDT&E DEVELOPMENT

Place of Performance

Location: GRAND PRAIRIE, DALLAS County, TEXAS, 75051

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $46.0 million to LOCKHEED MARTIN CORPORATION for work described as: ABAD PHASE 1 RDT&E DEVELOPMENT Key points: 1. Contract awarded for research and development in physical sciences, aligning with the DoD's strategic goals. 2. The contract is a delivery order under a larger indefinite-delivery/indefinite-quantity (IDIQ) vehicle, suggesting potential for future task orders. 3. Competition was full and open, indicating a broad market search and potentially competitive pricing. 4. The contract type is Cost Plus Fixed Fee (CPFF), which can incentivize cost control while allowing for profit. 5. Performance is expected to occur in Texas, potentially impacting the local economy and workforce. 6. The contract's duration of 960 days (approximately 2.6 years) suggests a significant, multi-phase research effort.

Value Assessment

Rating: fair

The contract value of $45.97 million for RDT&E services is substantial. Benchmarking this against similar contracts for advanced physical science research is challenging without more specific details on the scope of work. The CPFF contract type means the final cost could vary, but the fixed fee component provides some predictability. The awarded amount is within a reasonable range for complex R&D projects of this nature, though a detailed cost breakdown would be needed for a definitive value-for-money assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. The presence of 6 bidders suggests a healthy level of interest and competition for this type of R&D work. This broad competition is generally favorable for price discovery and ensuring the government receives competitive proposals.

Taxpayer Impact: Full and open competition typically leads to better pricing for taxpayers by fostering a competitive environment among potential contractors.

Public Impact

The primary beneficiary is the Department of Defense, which will receive advanced research and development in physical sciences. The contract supports advancements in areas critical to national security and technological superiority. The geographic impact is primarily in Texas, where the contractor will perform the work, potentially creating or sustaining high-skilled jobs. The project may lead to the development of new technologies that could have broader civilian applications in the future.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

CPFF contract type can lead to cost overruns if not closely monitored.
The specific nature of R&D makes it inherently risky, with potential for project delays or failure to meet objectives.
Reliance on a single large contractor for critical R&D may pose long-term strategic risks.

Positive Signals

Award to a large, established defense contractor like Lockheed Martin suggests a high likelihood of technical capability and project execution.
Full and open competition indicates a robust selection process and potential for innovative solutions.
The contract's clear RDT&E focus aligns with stated defense modernization priorities.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on physical sciences. The market for defense R&D is highly specialized, with a few large prime contractors dominating. Spending in this area is driven by national security imperatives and the need for technological advancement. Comparable spending benchmarks would typically be found within DoD's RDT&E budget allocations for advanced technology development.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the nature of advanced R&D and the prime contractor, it is unlikely that significant subcontracting opportunities for small businesses will be mandated, though the prime may engage them for specialized support.

Oversight & Accountability

Oversight will likely be managed by the contracting officer and technical representatives within the Department of the Air Force. The CPFF structure necessitates rigorous financial oversight to ensure costs are reasonable and allocable. Inspector General involvement is possible for audits or investigations into fraud, waste, or abuse. Transparency may be limited due to the sensitive nature of R&D work.

Related Government Programs

Department of Defense Research and Development Programs
Advanced Technology Development Contracts
Lockheed Martin Corporation Contracts
Air Force Science and Technology Investments

Risk Flags

Contract Type Risk (CPFF)
R&D Project Uncertainty
Potential for Cost Overruns

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $46.0 million to LOCKHEED MARTIN CORPORATION. ABAD PHASE 1 RDT&E DEVELOPMENT

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 $46.0 million.

What is the period of performance?

Start: 2023-09-13. End: 2026-04-30.

What is Lockheed Martin Corporation's track record with similar RDT&E contracts for the Department of Defense?

Lockheed Martin Corporation is a major defense contractor with extensive experience in research, development, testing, and evaluation (RDT&E) across various domains for the Department of Defense (DoD). They have a long history of securing and executing large-scale RDT&E contracts, particularly in areas such as aerospace, advanced materials, and defense systems. Their track record includes numerous successful projects that have led to significant technological advancements. However, like any large contractor, they have also faced scrutiny and challenges on specific contracts related to cost, schedule, and performance. A detailed review of their past performance on contracts with similar scope, complexity, and funding mechanisms (e.g., CPFF) would be necessary to fully assess their suitability for this specific award. Data on contract awards, performance ratings, and any past disputes or corrective actions would provide further insight.

How does the awarded amount of $45.97 million compare to typical RDT&E contracts in physical sciences?

The awarded amount of approximately $45.97 million for RDT&E in physical sciences is a significant sum, indicative of a complex and potentially long-term research effort. Benchmarking this value requires comparing it to contracts with similar objectives, scope, and duration within the DoD or other federal agencies. Contracts for basic research are often smaller, while those involving advanced development, prototyping, and system integration can easily reach tens or hundreds of millions of dollars. Given that this is a delivery order under an IDIQ, the total value of the IDIQ vehicle could be much larger. Without specific details on the technical objectives and deliverables, it's difficult to definitively state if this amount represents excellent or fair value. However, for a multi-year RDT&E project awarded through full and open competition, this figure is within a plausible range for specialized research.

What are the primary risks associated with a Cost Plus Fixed Fee (CPFF) contract type for RDT&E?

The Cost Plus Fixed Fee (CPFF) contract type presents specific risks for both the government and the contractor, particularly in RDT&E contexts. For the government, the primary risk is that the contractor may have less incentive to control costs rigorously, as all allowable costs are reimbursed. While the fixed fee provides a ceiling on profit, the total cost to the government can escalate if cost overruns occur. This necessitates robust government oversight to ensure costs are reasonable, allocable, and allowable. For the contractor, the risk lies in accurately estimating the costs to perform the work. If the actual costs exceed their estimates, their profit margin (the fixed fee) will be reduced. Conversely, if they significantly underrun costs, they may not achieve their desired profit. This contract type is often used when the scope of work is not well-defined, as is common in R&D, but it requires diligent administration to mitigate financial risks.

What does the duration of 960 days (approximately 2.6 years) imply about the scope and complexity of this RDT&E effort?

A contract duration of 960 days, roughly 2.6 years, suggests that the RDT&E effort is substantial and likely involves multiple phases or complex developmental stages. Short-term R&D projects are typically under a year, while longer durations indicate a need for sustained research, iterative development, testing, and potentially integration activities. This timeframe allows for exploration of novel concepts, addressing unforeseen technical challenges, and refining solutions. It implies that the project is not a simple feasibility study but rather a significant undertaking aimed at achieving tangible research outcomes or developing advanced capabilities. The extended period also necessitates careful project management and milestone tracking to ensure progress and accountability throughout the contract's life.

How does the 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)' NAICS code influence the nature of the contract?

The North American Industry Classification System (NAICS) code 541715, 'Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology),' precisely defines the domain of this contract. It indicates that the research will focus on fundamental and applied sciences related to physics, chemistry, materials science, various engineering disciplines, and biological sciences, excluding highly specialized fields like nanotechnology and biotechnology. This scope suggests the contract could involve work in areas such as advanced materials development, energy research, aerospace engineering, electronics, environmental science, or complex system modeling. The classification helps ensure that the contract is awarded to entities with the appropriate scientific and technical expertise and that the research aligns with specific government priorities within these broad scientific fields.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and 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: 6

Pricing Type: COST PLUS FIXED FEE (U)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 1701 W MARSHALL DR, GRAND PRAIRIE, TX, 75051

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: $54,252,317

Exercised Options: $54,252,317

Current Obligation: $45,966,591

Subaward Activity

Number of Subawards: 21

Total Subaward Amount: $9,382,980

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: FA868423DB071

IDV Type: IDC

Timeline