DoD Awards $4B GPS III Follow-On Contract to Lockheed Martin for Missile and Space Vehicle Manufacturing
Contract Overview
Contract Amount: $4,044,299,611 ($4.0B)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2018-09-26
End Date: 2037-01-31
Contract Duration: 6,702 days
Daily Burn Rate: $603.4K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE AWARD FEE
Sector: Defense
Official Description: GLOBAL POSITIONING SYSTEMS III FOLLOW-ON
Place of Performance
Location: LITTLETON, DOUGLAS County, COLORADO, 80125
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $4.04 billion to LOCKHEED MARTIN CORP for work described as: GLOBAL POSITIONING SYSTEMS III FOLLOW-ON Key points: 1. Significant investment in advanced satellite technology for national security. 2. Sole awardee Lockheed Martin suggests potential lack of competition or specialized capabilities. 3. Long contract duration (2018-2037) raises concerns about adaptability to future technological shifts. 4. Fixed Price Award Fee structure aims to balance cost control with performance incentives.
Value Assessment
Rating: fair
The contract value of over $4 billion is substantial. Benchmarking against similar large-scale satellite development contracts is difficult without more specific cost breakdowns, but the scale suggests significant R&D and manufacturing investment.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
Although advertised as full and open competition, the award to a single entity, Lockheed Martin, warrants scrutiny. This could indicate a highly specialized requirement or potential issues in the competitive process that limited bids.
Taxpayer Impact: The substantial cost of this program represents a significant allocation of taxpayer funds towards national defense and technological advancement in space-based navigation.
Public Impact
Ensures continued operation and modernization of critical GPS capabilities for military and civilian use. Supports high-tech manufacturing jobs and innovation within the aerospace sector. Potential for technological advancements in satellite communication and navigation systems.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Long-term contract duration
- Sole awardee despite full and open competition
- Complexity of space-based systems
Positive Signals
- Critical national security asset
- Potential for technological advancement
- Fixed price award fee structure
Sector Analysis
This contract falls within the Defense sector, specifically focusing on guided missile and space vehicle manufacturing. Spending in this area is typically high due to the complexity, long development cycles, and critical national security implications of such systems.
Small Business Impact
The data indicates no specific set-aside for small businesses. Given the scale and specialized nature of GPS satellite manufacturing, it is unlikely that small businesses would be primary contractors, though they may participate as subcontractors.
Oversight & Accountability
The long duration of the contract necessitates robust oversight from the Department of the Air Force to ensure performance, manage costs, and adapt to evolving requirements. Regular reviews and milestone assessments are crucial.
Related Government Programs
- Guided Missile and Space Vehicle Manufacturing
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Potential for cost overruns due to contract complexity and long duration.
- Risk of technological obsolescence if not managed proactively.
- Dependence on a single contractor may limit future innovation.
- Ensuring effective competition throughout the contract lifecycle.
Tags
guided-missile-and-space-vehicle-manufac, department-of-defense, co, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $4.04 billion to LOCKHEED MARTIN CORP. GLOBAL POSITIONING SYSTEMS III FOLLOW-ON
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
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 $4.04 billion.
What is the period of performance?
Start: 2018-09-26. End: 2037-01-31.
What specific technological advancements does the GPS III Follow-On program aim to achieve compared to previous generations, and how are these justified by the contract value?
The GPS III Follow-On program aims to enhance signal security, accuracy, and resilience against jamming and spoofing. It also incorporates new capabilities like a civilian search and rescue payload. The substantial contract value reflects the significant R&D, advanced manufacturing, and integration required for these next-generation capabilities, ensuring continued global positioning superiority for military and civilian users.
Given the award to a single entity, what measures are in place to mitigate the risks associated with a lack of direct competition throughout the contract's lifecycle?
While awarded under full and open competition, the single awardee necessitates strong government oversight. Measures likely include detailed performance metrics, milestone-based payments tied to deliverables, and potential for contract modifications or future competitive procurements for upgrades. The fixed price award fee structure also incentivizes contractor performance and cost management.
How will the effectiveness of the GPS III Follow-On system be measured, particularly considering its long operational lifespan and the evolving threat landscape?
Effectiveness will be measured through rigorous testing, validation of performance metrics against contract requirements (accuracy, availability, resilience), and successful integration into military and civilian user systems. The long lifespan requires ongoing monitoring, periodic reviews, and potential for future upgrades or modifications to address evolving threats and technological advancements, ensuring sustained operational effectiveness.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: FA880717R0009
Offers Received: 1
Pricing Type: FIXED PRICE AWARD FEE (M)
Evaluated Preference: NONE
Contractor Details
Address: 12257 S WADSWORTH BLVD, LITTLETON, CO, 80125
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $4,202,388,794
Exercised Options: $4,151,288,274
Current Obligation: $4,044,299,611
Actual Outlays: $32,590,705
Subaward Activity
Number of Subawards: 2604
Total Subaward Amount: $7,843,028,892
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-09-26
Current End Date: 2037-01-31
Potential End Date: 2037-01-31 00:00:00
Last Modified: 2026-01-02
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