DoD Awards $124.7M for GPS Satellite Support to Lockheed Martin, Lacking Competition
Contract Overview
Contract Amount: $124,729,633 ($124.7M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2022-07-01
End Date: 2026-12-31
Contract Duration: 1,644 days
Daily Burn Rate: $75.9K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: IT
Official Description: GLOBAL POSITIONING SYSTEM IIR/IIR-M,III,IIIF ON ORBIT SUPPORT TASK ORDER
Place of Performance
Location: LITTLETON, DOUGLAS County, COLORADO, 80125
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $124.7 million to LOCKHEED MARTIN CORP for work described as: GLOBAL POSITIONING SYSTEM IIR/IIR-M,III,IIIF ON ORBIT SUPPORT TASK ORDER Key points: 1. Significant contract value for essential satellite support. 2. Sole-source award raises concerns about price discovery and competition. 3. Long-term support contract (2022-2026) impacts taxpayer investment. 4. Focus on critical GPS infrastructure highlights national security reliance.
Value Assessment
Rating: questionable
The contract value of $124.7M for on-orbit support of GPS satellites appears high given the lack of competitive bidding. Without market comparison, it's difficult to assess if this price is optimal.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there is no competitive pressure to reduce prices.
Taxpayer Impact: The lack of competition for this essential service may result in inflated costs, directly impacting taxpayer funds allocated for national defense and space infrastructure.
Public Impact
Ensures continued operation of vital GPS satellites for military and civilian use. Potential for overspending due to sole-source award impacts budget allocation. Reliability of GPS services is critical for national security and economic activities. Long-term commitment to a single contractor raises questions about future innovation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of competition
- Potential for cost overruns
- Long-term contract duration
Positive Signals
- Essential service provision
- Supports critical national infrastructure
- Experienced contractor
Sector Analysis
This contract falls within the telecommunications sector, specifically supporting critical satellite infrastructure. Spending benchmarks for similar long-term satellite operations and maintenance contracts are difficult to ascertain without competitive data.
Small Business Impact
The data provided does not indicate any subcontracting opportunities for small businesses. The sole-source nature of this award further limits potential for small business involvement.
Oversight & Accountability
The Department of the Air Force awarded this contract. Oversight is crucial to ensure Lockheed Martin delivers on its obligations and to monitor costs, especially given the sole-source nature of the award.
Related Government Programs
- All Other Telecommunications
- Department of Defense Contracting
- Department of the Air Force Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Long-term reliance on one vendor.
- Lack of transparency in price justification.
- Risk of vendor lock-in.
Tags
all-other-telecommunications, department-of-defense, co, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $124.7 million to LOCKHEED MARTIN CORP. GLOBAL POSITIONING SYSTEM IIR/IIR-M,III,IIIF ON ORBIT SUPPORT TASK ORDER
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 $124.7 million.
What is the period of performance?
Start: 2022-07-01. End: 2026-12-31.
What is the justification for awarding this contract on a sole-source basis, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or circumstances where only one contractor can meet the requirement. For this GPS support contract, the agency likely cited specific technical expertise or existing infrastructure knowledge held by Lockheed Martin. To ensure fair pricing, the agency should conduct a thorough price analysis, potentially using historical data, cost realism assessments, and independent government cost estimates, even without direct competition.
What are the risks associated with relying on a single contractor for long-term, critical satellite support, particularly regarding technological obsolescence and vendor lock-in?
Relying on a single contractor for extended periods poses risks of technological stagnation, as the contractor may have less incentive to innovate. Vendor lock-in is also a significant concern, making it difficult and costly to switch providers if performance issues arise or better solutions become available. This can lead to higher long-term costs and reduced flexibility for the government.
How does the performance of this contract contribute to the overall effectiveness and reliability of the Global Positioning System for national security and civilian applications?
The effective on-orbit support of GPS satellites is paramount to the continuous and reliable functioning of the entire GPS constellation. This directly impacts national security by ensuring accurate navigation and timing for military operations, and it affects civilian applications ranging from transportation and emergency services to financial transactions and scientific research. Any lapse in support could have widespread negative consequences.
Industry Classification
NAICS: Information › Other Telecommunications › All Other Telecommunications
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Address: 12257 S WADSWORTH BLVD, LITTLETON, CO, 80125
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: $147,996,782
Exercised Options: $147,996,782
Current Obligation: $124,729,633
Subaward Activity
Number of Subawards: 34
Total Subaward Amount: $32,986,842
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: FA882322D0002
IDV Type: IDC
Timeline
Start Date: 2022-07-01
Current End Date: 2026-12-31
Potential End Date: 2026-12-31 00:00:00
Last Modified: 2025-12-23
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