DoD's $34M 3DELRR PRE-EMD TD PHASE contract awarded to Lockheed Martin raises questions about value and competition
Contract Overview
Contract Amount: $34,139,981 ($34.1M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2012-08-20
End Date: 2013-09-20
Contract Duration: 396 days
Daily Burn Rate: $86.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 3
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: 3DELRR PRE-EMD TD PHASE
Place of Performance
Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $34.1 million to LOCKHEED MARTIN CORPORATION for work described as: 3DELRR PRE-EMD TD PHASE Key points: 1. The contract value of $34.14M for a 396-day duration appears high for a pre-engineering development phase. 2. Lockheed Martin, a major defense contractor, secured this award, suggesting limited competition. 3. The 'FULL AND OPEN COMPETITION' designation needs scrutiny given the single award. 4. The sector is IT/Defense, with a focus on navigation and guidance systems.
Value Assessment
Rating: questionable
The contract value of $34.14M for a 396-day duration seems high for a pre-engineering development phase. Benchmarking against similar R&D contracts for advanced navigation systems is needed to assess true value.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Despite being listed as 'FULL AND OPEN COMPETITION', the award to a single entity, Lockheed Martin, raises concerns about the effectiveness of the competition process and whether it truly drove the best price.
Taxpayer Impact: The potential for overpayment due to limited effective competition could result in taxpayer funds being used inefficiently.
Public Impact
Taxpayers may be overpaying for advanced navigation technology due to a potentially flawed competition process. The Department of Defense continues to invest heavily in complex systems, impacting national security priorities. The reliance on large defense contractors like Lockheed Martin shapes the landscape of military technology development.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of clear value for money
- Potential for limited competition despite 'full and open' status
- High contract value for an early-stage development phase
Positive Signals
- Awarded to a reputable defense contractor
- Focus on critical navigation and guidance systems
Sector Analysis
This contract falls within the IT/Defense sector, specifically focusing on advanced navigation and guidance systems. Spending in this area is critical for military operations but often involves high R&D costs and complex procurement processes.
Small Business Impact
The data does not indicate any specific involvement or benefit for small businesses in this contract. Large defense contracts often bypass smaller enterprises, limiting their opportunities in advanced technology development.
Oversight & Accountability
The 'FULL AND OPEN COMPETITION' designation requires further investigation to ensure the process was robust and truly competitive. Oversight is needed to confirm that the final price reflects fair market value and that the development meets its objectives.
Related Government Programs
- Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for inflated pricing
- Questionable effectiveness of competition
- Lack of transparency in cost justification
- High value for early-stage development
Tags
search-detection-navigation-guidance-aer, department-of-defense, ny, dca, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $34.1 million to LOCKHEED MARTIN CORPORATION. 3DELRR PRE-EMD TD PHASE
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 $34.1 million.
What is the period of performance?
Start: 2012-08-20. End: 2013-09-20.
What specific deliverables were expected for the $34.14M pre-engineering development phase, and how do they justify the cost?
The contract details are limited, but the 'PRE-EMD TD PHASE' suggests early-stage research and development for the 3DELRR system. Justification for the cost would likely involve the complexity of the technology, the expertise required, and the projected long-term benefits for the Air Force's situational awareness and targeting capabilities.
How effectively did the 'FULL AND OPEN COMPETITION' process ensure competitive pricing for this contract?
The designation of 'FULL AND OPEN COMPETITION' alongside a single award to Lockheed Martin raises a red flag. It suggests that either no other qualified bidders emerged, or the process was structured in a way that favored a specific incumbent. This warrants a review to ensure the government received the best possible price and value.
What are the potential risks associated with awarding a significant pre-development contract to a single, large defense contractor?
The primary risks include reduced innovation due to lack of competitive pressure, potential cost overruns if the contractor faces no incentive to be efficient, and a lack of alternative solutions if the chosen technology proves problematic. It also concentrates critical capabilities within one company, potentially creating dependencies.
Industry Classification
NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Product/Service Code: RESEARCH AND DEVELOPMENT › OTHER RESEARCH/DEVELOPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Offers Received: 3
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 497 ELECTRONICS PKWY BLDG 5, LIVERPOOL, NY, 22
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: $34,139,981
Exercised Options: $34,139,981
Current Obligation: $34,139,981
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2012-08-20
Current End Date: 2013-09-20
Potential End Date: 2013-09-20 00:00:00
Last Modified: 2013-10-29
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