DoD awards $156M for missile and space systems R&D to Lockheed Martin, impacting GPS technology

Contract Overview

Contract Amount: $156,049,511 ($156.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2004-01-05

End Date: 2008-05-31

Contract Duration: 1,608 days

Daily Burn Rate: $97.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 2

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: 200404!000032!5700!CZ46 !SMC/PKG LOS ANGELES AFB !FA880704C0001 !A!N! !N! ! !20040105!20051231!176325579!176325579!834951691!N!LOCKHEED MARTIN CORPORATION !230 MALL BLVD !KING OF PRUSSI !PA!19406!39736!091!42!KING OF PRUSSIA !MONTGOMERY !PENN !+000010330000!N!N!000020785675!AC22!RDTE/MISSILE AND SPACE SYSTEMS-APPLIED RESEARCH !A2 !MISSILE AND SPACE SYSTEMS !166 !NAVSTAR GPS !541710!E! !3! ! ! ! ! !99990909!B! ! !A! !A!N!U!2!002!B! !Z!N!Z! ! !N!C!N! ! ! !Z!Z!A!A!000!A!D!N! ! ! !Y! ! !0001! !

Place of Performance

Location: KING OF PRUSSIA, MONTGOMERY County, PENNSYLVANIA, 19406

State: Pennsylvania Government Spending

Plain-Language Summary

Department of Defense obligated $156.0 million to LOCKHEED MARTIN CORPORATION for work described as: 200404!000032!5700!CZ46 !SMC/PKG LOS ANGELES AFB !FA880704C0001 !A!N! !N! ! !20040105!20051231!176325579!176325579!834951691!N!LOCKHEED MARTIN CORPORATION !230 MALL BLVD !KING OF PRUSSI !PA!19406!39736!091!42!KING OF PRUSSIA !MONT… Key points: 1. Contract awarded for applied research in missile and space systems, specifically for the NAVSTAR GPS program. 2. Significant investment in R&D for a critical defense technology, potentially enhancing satellite navigation capabilities. 3. Contractor has a strong track record in aerospace and defense, suggesting technical proficiency. 4. The contract duration of over 4 years indicates a long-term commitment to research and development. 5. Focus on applied research suggests a move towards practical application and potential system upgrades. 6. The large contract value points to the complexity and importance of the GPS program.

Value Assessment

Rating: good

The contract value of $156,049,511.23 for applied research in missile and space systems appears reasonable given the scope and duration. While direct comparisons are difficult without more specific project details, R&D contracts of this magnitude for critical defense systems like GPS are not uncommon. The cost-plus-fixed-fee (CPFF) structure allows for flexibility in research while providing the contractor with a defined profit margin. Benchmarking against similar applied research contracts for satellite systems would provide further insight into value for money.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The presence of two bids suggests a competitive environment, which typically drives better pricing and innovation. The specific details of the competition, such as the number of proposals received and the evaluation criteria, would offer a clearer picture of the effectiveness of the competition in securing the best value for the government.

Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a market where contractors are incentivized to offer competitive pricing and superior technical solutions to win awards.

Public Impact

The primary beneficiary is the Department of Defense, which will receive enhanced capabilities for the NAVSTAR GPS system. Services delivered include applied research and development in missile and space systems, crucial for national security. The geographic impact is national, as the GPS system has widespread civilian and military applications. Workforce implications include employment for scientists, engineers, and technicians involved in advanced research and development.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns in R&D projects due to the inherent uncertainties in research.
Dependence on a single contractor for critical GPS technology development could pose a long-term risk.
The complexity of space systems R&D may lead to unforeseen technical challenges and delays.

Positive Signals

Award to a well-established contractor with extensive experience in aerospace and defense.
Focus on applied research suggests a clear path towards tangible improvements in GPS functionality.
Full and open competition indicates a robust selection process aimed at securing the best value.

Sector Analysis

This contract falls within the Research and Development sector, specifically focusing on applied research in physical, engineering, and life sciences. The market for missile and space systems R&D is highly specialized, dominated by large defense contractors. Spending in this area is driven by national security needs and technological advancements in areas like satellite technology and navigation. Comparable spending benchmarks would involve looking at other large-scale R&D contracts for advanced defense systems.

Small Business Impact

The data indicates this contract was not set aside for small businesses. Given the specialized nature of missile and space systems R&D, it is common for prime contracts to be awarded to large, established corporations. However, opportunities for small businesses may exist further down the supply chain as subcontractors to Lockheed Martin, particularly for specialized components or services.

Oversight & Accountability

Oversight for this contract would typically be managed by the Defense Contract Management Agency (DCMA), ensuring compliance with contract terms and performance standards. Accountability measures are embedded in the cost-plus-fixed-fee structure, which requires detailed reporting and justification of costs. Transparency is facilitated through contract awards databases and reporting requirements, though specific R&D project details may be classified.

Related Government Programs

NAVSTAR GPS
Missile and Space Systems
Applied Research and Development
Satellite Technology
National Security Programs

Risk Flags

Cost Overrun Risk
Technical Complexity
Long-Term Contractor Dependence

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $156.0 million to LOCKHEED MARTIN CORPORATION. 200404!000032!5700!CZ46 !SMC/PKG LOS ANGELES AFB !FA880704C0001 !A!N! !N! ! !20040105!20051231!176325579!176325579!834951691!N!LOCKHEED MARTIN CORPORATION !230 MALL BLVD !KING OF PRUSSI !PA!19406!39736!091!42!KING OF PRUSSIA !MONTGOMERY !PENN !+000010330000!N!N!000020785675!AC22!RDTE/MISSILE AND SPACE SYSTEMS-APPLIED RESEARCH !A2 !MISSILE AND SPACE SYSTEMS !166 !NAVSTAR GPS !541710!E! !3! ! ! ! ! !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 $156.0 million.

What is the period of performance?

Start: 2004-01-05. End: 2008-05-31.

What is Lockheed Martin's track record with similar Department of Defense R&D contracts, particularly in space systems?

Lockheed Martin Corporation is a major defense contractor with a long and extensive history of performing research and development for the Department of Defense, especially in the realm of space systems. They are a primary contractor for numerous satellite programs, including those related to communication, intelligence, and navigation. Their experience with programs like the GPS III satellites demonstrates a deep understanding of the complexities involved in developing and maintaining advanced space-based assets. Past performance reviews and contract histories with the DoD generally indicate a strong capability in delivering complex technological solutions, though like any large contractor, they have also faced scrutiny on specific projects regarding cost and schedule.

How does the $156 million contract value compare to other applied research contracts for GPS technology?

The $156 million contract value for applied research in missile and space systems for the NAVSTAR GPS program is substantial, reflecting the critical nature and complexity of satellite navigation technology. While specific figures for 'applied research' can vary widely, this amount is consistent with the significant investments required for advanced R&D in space-based systems. For context, major GPS satellite procurements or upgrades can run into billions of dollars. Applied research contracts, focusing on specific technological advancements or problem-solving, typically fall within the tens to hundreds of millions, depending on the scope and duration. This contract's value suggests a focused effort on enhancing specific aspects of the GPS system's capabilities or underlying technology.

What are the primary risks associated with this type of cost-plus-fixed-fee R&D contract?

Cost-plus-fixed-fee (CPFF) contracts, while offering flexibility for R&D where exact costs are uncertain, carry inherent risks. For the government, the primary risk is that the final cost could exceed initial estimates, even though the contractor's fee is fixed. This is because the contractor is reimbursed for all allowable costs incurred. If the research proves more complex or requires more resources than anticipated, the total expenditure will increase. Another risk is the potential for scope creep, where the research objectives expand beyond the original intent, leading to higher costs and potentially longer timelines. Effective oversight and clear definition of research objectives are crucial to mitigate these risks.

What is the expected impact of this applied research on the future capabilities of the NAVSTAR GPS system?

This applied research contract is expected to contribute to the modernization and enhancement of the NAVSTAR GPS system. Applied research focuses on solving practical problems and developing new technologies or improving existing ones. Therefore, the outcomes of this contract could lead to advancements in areas such as signal accuracy, anti-jamming capabilities, cybersecurity resilience, or the integration of new features for military or civilian users. The specific impact will depend on the research objectives, but it is likely aimed at ensuring GPS remains a leading-edge navigation system capable of meeting evolving operational requirements and countering emerging threats.

How has federal spending on GPS technology R&D evolved over the past decade?

Federal spending on GPS technology R&D has been a consistent and significant investment over the past decade, driven by the system's critical role in national security and its widespread civilian use. While specific figures fluctuate annually based on program priorities and modernization efforts, the DoD has continuously allocated substantial funds towards maintaining, upgrading, and enhancing the GPS constellation and its ground control systems. This includes investments in next-generation satellites (like GPS III), improved signal security, alternative PNT (Positioning, Navigation, and Timing) solutions, and research into resilient PNT technologies. The overall trend indicates a sustained commitment to ensuring the reliability, accuracy, and security of the GPS system.

Industry Classification

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

Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 2

Pricing Type: COST PLUS FIXED FEE (U)

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 230 MALL BLVD, KING OF PRUSSIA, PA, 19406

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline