DoD Awards $2M for Priority Support Services to Lockheed Martin, Raising Questions on Value and Competition
Contract Overview
Contract Amount: $2,000,000 ($2.0M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2025-08-01
End Date: 2026-07-31
Contract Duration: 364 days
Daily Burn Rate: $5.5K/day
Competition Type: FULL AND OPEN COMPETITION
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: THE CONTRACTOR SHALL PROVIDE PRIORITY SUPPORT EFFORTS WHICH INCLUDES ENGINEERING AND FABRICATION. THE CONTRACTOR SHALL PROVIDE ALL PERSONNEL AND SUPERVISION REQUIRED FOR CUSTOMER SUPPORT AS DEFINED IN THIS SOO AND SUB-SEQUENT REVISIONS.
Place of Performance
Location: LEXINGTON, FAYETTE County, KENTUCKY, 40516
State: Kentucky Government Spending
Plain-Language Summary
Department of Defense obligated $2.0 million to LOCKHEED MARTIN CORPORATION for work described as: THE CONTRACTOR SHALL PROVIDE PRIORITY SUPPORT EFFORTS WHICH INCLUDES ENGINEERING AND FABRICATION. THE CONTRACTOR SHALL PROVIDE ALL PERSONNEL AND SUPERVISION REQUIRED FOR CUSTOMER SUPPORT AS DEFINED IN THIS SOO AND SUB-SEQUENT REVISIONS. Key points: 1. Contract focuses on engineering and fabrication for priority support, with unclear scope. 2. Lockheed Martin, a major defense contractor, secured this award. 3. The contract's cost-plus-fixed-fee structure may incentivize higher spending. 4. Limited information is available on the specific services and their necessity.
Value Assessment
Rating: questionable
The $2 million contract value for engineering and fabrication support is difficult to benchmark without specific deliverables. Cost-plus contracts can lead to cost overruns if not tightly managed, potentially exceeding the value of similar fixed-price contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, suggesting multiple bids were considered. However, the specific details of the bidding process and how price discovery was achieved are not provided, leaving room for potential inefficiencies.
Taxpayer Impact: The $2 million allocated to this contract represents taxpayer funds. Without clear justification for the necessity and cost-effectiveness of the services, there is a risk of inefficient resource allocation.
Public Impact
Taxpayers may be funding services with unclear benefits or necessity. The reliance on a single large contractor for critical support could limit future flexibility. Lack of transparency in the bidding process raises concerns about optimal pricing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost-plus contract type
- Lack of detailed scope of work
- Limited public information on necessity
Positive Signals
- Awarded under full and open competition
- Support for critical priority efforts
Sector Analysis
This contract falls under Other Support Services, a broad category. Benchmarking spending in this sector is challenging due to the diverse nature of services. However, significant spending on engineering and fabrication for priority support warrants scrutiny to ensure alignment with strategic goals.
Small Business Impact
The contract was awarded to Lockheed Martin Corporation, a large prime contractor. There is no indication that small businesses were involved as subcontractors or partners in this specific award, suggesting a missed opportunity for small business engagement.
Oversight & Accountability
Oversight will be crucial to ensure that the cost-plus-fixed-fee structure does not lead to excessive spending and that the services provided are essential and effectively delivered. Regular reviews of performance metrics and cost reports are necessary.
Related Government Programs
- All Other Support Services
- Department of Defense Contracting
- U.S. Special Operations Command Programs
Risk Flags
- Cost-plus contract type may lead to higher costs.
- Vague scope of work ('priority support efforts').
- Lack of specific performance metrics provided.
- No indication of small business participation.
- Potential for cost overruns without strict oversight.
Tags
all-other-support-services, department-of-defense, ky, delivery-order, 1m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $2.0 million to LOCKHEED MARTIN CORPORATION. THE CONTRACTOR SHALL PROVIDE PRIORITY SUPPORT EFFORTS WHICH INCLUDES ENGINEERING AND FABRICATION. THE CONTRACTOR SHALL PROVIDE ALL PERSONNEL AND SUPERVISION REQUIRED FOR CUSTOMER SUPPORT AS DEFINED IN THIS SOO AND SUB-SEQUENT REVISIONS.
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (U.S. Special Operations Command).
What is the total obligated amount?
The obligated amount is $2.0 million.
What is the period of performance?
Start: 2025-08-01. End: 2026-07-31.
What specific engineering and fabrication tasks are included in 'priority support efforts,' and how do they directly contribute to the U.S. Special Operations Command's mission?
The contract broadly defines 'priority support efforts' to include engineering and fabrication. Without a detailed breakdown of these tasks, it's difficult to assess their direct contribution to SOCOM's mission. Clarity on the specific technical requirements, expected outcomes, and the criticality of these efforts is needed to justify the $2 million expenditure and ensure alignment with operational needs.
Given the cost-plus-fixed-fee structure, what mechanisms are in place to prevent cost overruns and ensure the contractor is incentivized to control expenses?
Cost-plus-fixed-fee contracts inherently carry a risk of cost escalation. To mitigate this, the Department of Defense must implement robust oversight, including detailed cost tracking, regular audits, and performance reviews. Incentive clauses tied to cost savings or efficiency improvements, along with clear limitations on allowable costs, are crucial to ensure Lockheed Martin is motivated to manage expenses effectively.
How does the awarded contract ensure that the services provided are the most effective and efficient solutions available, especially considering the potential for innovation from a competitive market?
While awarded under full and open competition, the effectiveness and efficiency of the chosen solutions depend on the proposal evaluation criteria and the contractor's execution. The government should ensure that the selection process prioritized innovative and cost-effective approaches. Ongoing performance monitoring and the potential for future competition based on demonstrated results will be key to ensuring continued effectiveness and efficiency.
Industry Classification
NAICS: Administrative and Support and Waste Management and Remediation Services › Other Support Services › All Other Support Services
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 5749 BRIAR HILL RD, LEXINGTON, KY, 40516
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: $10,619,005
Exercised Options: $5,685,898
Current Obligation: $2,000,000
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: H9225417D0001
IDV Type: IDC
Timeline
Start Date: 2025-08-01
Current End Date: 2026-07-31
Potential End Date: 2027-06-10 00:00:00
Last Modified: 2026-01-07
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