Customs and Border Protection awarded $33.5M to Lockheed Martin for aircraft manufacturing support

Contract Overview

Contract Amount: $33,517,247 ($33.5M)

Contractor: Lockheed Martin Aeronautical Systems Support Company

Awarding Agency: Department of Homeland Security

Start Date: 2010-02-05

End Date: 2012-09-30

Contract Duration: 968 days

Daily Burn Rate: $34.6K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: NO EPA REQUIREMENTS

Place of Performance

Location: MARIETTA, COBB County, GEORGIA, 30062

State: Georgia Government Spending

Plain-Language Summary

Department of Homeland Security obligated $33.5 million to LOCKHEED MARTIN AERONAUTICAL SYSTEMS SUPPORT COMPANY for work described as: NO EPA REQUIREMENTS Key points: 1. Contract value represents a significant investment in aviation support services. 2. Sole awardee suggests potential for limited competition or specialized capabilities. 3. Long contract duration indicates a sustained need for these services. 4. Firm fixed price contract type shifts cost risk to the contractor. 5. The contract falls within the broader defense and aerospace sector. 6. Geographic focus on Georgia for contract performance.

Value Assessment

Rating: fair

The contract value of $33.5 million over approximately 2.7 years (968 days) averages to roughly $11.5 million annually. Benchmarking this against similar contracts for aircraft manufacturing support is challenging without more specific service details. However, the firm fixed-price nature suggests the government sought cost certainty. The absence of a small business set-aside and the sole awardee status might indicate a lack of competitive pressure on pricing, potentially leading to less favorable value compared to a more competitive scenario.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit offers. However, the fact that only one award was made suggests that either only one offeror was deemed technically acceptable, or that Lockheed Martin was the only entity capable of meeting the stringent requirements. This level of competition, while technically open, may not have driven the most competitive pricing due to the limited number of viable bidders.

Taxpayer Impact: While the competition was technically open, the single award limits the direct benefit to taxpayers in terms of price reduction through robust bidding. Taxpayers may have paid a premium if alternative solutions were not fully explored or if the sole awardee's pricing was not aggressively challenged.

Public Impact

U.S. Customs and Border Protection benefits from continued aircraft manufacturing support, crucial for border security operations. The services delivered likely ensure the operational readiness and maintenance of CBP's aviation assets. Geographic impact is concentrated in Georgia, where the contractor's operations are based. Workforce implications include employment opportunities within Lockheed Martin and its supply chain in Georgia.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for vendor lock-in due to sole awardee status.
Limited transparency into the specific cost drivers for the firm fixed price.
Reliance on a single contractor for critical aviation support.

Positive Signals

Firm fixed price contract shifts cost overrun risk to the contractor.
Full and open competition, in principle, allows for broad market participation.
Long-term contract indicates a stable and predictable need for services.

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on support services for aircraft. The market for such specialized support is often dominated by large, established defense contractors like Lockheed Martin due to the high technical expertise, security clearances, and infrastructure required. Comparable spending benchmarks would depend heavily on the specific aircraft types and the scope of support (e.g., maintenance, upgrades, manufacturing components).

Small Business Impact

The contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses in the provided data. This suggests that the primary award went to a large prime contractor, and opportunities for small businesses would likely be through direct subcontracting by Lockheed Martin, which is not explicitly detailed here. The impact on the small business ecosystem is therefore indirect and dependent on the prime contractor's subcontracting strategy.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of Homeland Security's contracting and program management offices. As a delivery order under a larger contract vehicle, specific oversight details might be embedded within the parent contract's terms. Transparency is moderate, with the award details publicly available. Inspector General jurisdiction would apply to investigations of fraud, waste, or abuse related to the contract.

Related Government Programs

Department of Homeland Security Aviation Procurement
Lockheed Martin Defense Contracts
Aircraft Manufacturing Support Services
Federal Aviation Procurement

Risk Flags

Sole awardee in a full and open competition may indicate limited market capability or intense competition.
Firm fixed price contracts can sometimes lead to higher initial pricing if the contractor heavily buffers for risk.
Long contract duration increases exposure to potential technological obsolescence or changing mission needs.

Frequently Asked Questions

What is this federal contract paying for?

Department of Homeland Security awarded $33.5 million to LOCKHEED MARTIN AERONAUTICAL SYSTEMS SUPPORT COMPANY. NO EPA REQUIREMENTS

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN AERONAUTICAL SYSTEMS SUPPORT COMPANY.

Which agency awarded this contract?

Awarding agency: Department of Homeland Security (U.S. Customs and Border Protection).

What is the total obligated amount?

The obligated amount is $33.5 million.

What is the period of performance?

Start: 2010-02-05. End: 2012-09-30.

What specific aircraft models or systems does this contract support?

The provided data indicates the contract is for 'Aircraft Manufacturing' (NAICS 336411) and was awarded to Lockheed Martin Aeronautical Systems Support Company. However, it does not specify the exact aircraft models or systems being supported. Given Lockheed Martin's portfolio and the agency (CBP), potential aircraft could include surveillance planes, helicopters, or fixed-wing aircraft used for border patrol and interdiction. Further details on the Statement of Work (SOW) within the contract documentation would be necessary to identify the specific platforms.

How does the $33.5 million contract value compare to similar CBP aviation support contracts?

Direct comparison of the $33.5 million value is difficult without knowing the precise scope of services and duration of comparable contracts. CBP operates a large fleet of aircraft, and support contracts can range significantly based on complexity, number of aircraft, and type of support (e.g., depot maintenance, component repair, avionics upgrades, manufacturing). This contract, valued at approximately $11.5 million per year over its 968-day duration, appears to be a substantial but not necessarily outlier amount for specialized aviation support within a federal agency of CBP's size. A deeper analysis would require benchmarking against contracts with similar SOWs and aircraft types.

What are the key performance indicators (KPIs) or metrics used to evaluate Lockheed Martin's performance under this contract?

The provided data does not include specific Key Performance Indicators (KPIs) or metrics for this contract. Typically, for aircraft manufacturing and support contracts, KPIs would focus on factors such as on-time delivery of manufactured components or completed aircraft, adherence to quality standards (e.g., defect rates), technical performance of supported systems, and responsiveness to repair or maintenance requests. The firm fixed-price nature suggests that meeting defined technical and schedule requirements is paramount, with penalties or incentives potentially tied to performance outcomes outlined in the contract's SOW and Performance Work Statement (PWS).

What is Lockheed Martin's track record with the Department of Homeland Security, particularly CBP?

Lockheed Martin is a major defense contractor with extensive experience supporting various government agencies, including the Department of Homeland Security (DHS) and its components like Customs and Border Protection (CBP). They have historically been involved in providing a wide range of services and products, including aviation systems, surveillance technology, and IT solutions. While this specific contract focuses on aircraft manufacturing support, Lockheed Martin's broader engagement with CBP likely encompasses other areas, reflecting a long-standing relationship built on delivering complex technological and support services. Their overall track record with DHS is generally characterized by large-scale, high-value contracts.

What is the historical spending trend for aircraft manufacturing support by CBP or DHS?

The provided data is for a single contract awarded in 2010. To assess historical spending trends, a broader analysis of CBP and DHS's procurement history for aircraft manufacturing and support services over multiple fiscal years would be required. This would involve examining contract databases for similar awards, identifying trends in spending levels, the number and types of contractors utilized, and the evolution of requirements. Without this broader dataset, it's impossible to determine if the $33.5 million award represents an increase, decrease, or stable level of spending for this category.

Are there any identified risks associated with this contract, such as cost overruns or performance failures, given the firm fixed-price structure?

The firm fixed-price (FFP) contract structure inherently shifts the risk of cost overruns to the contractor, Lockheed Martin. This means that if the costs of labor, materials, or other expenses exceed the contract price, the contractor absorbs the loss. However, risks remain. Performance failures are a significant concern; if Lockheed Martin fails to meet the technical specifications, quality standards, or delivery schedules, CBP may incur delays, require corrective actions, or potentially terminate the contract. The long duration and specialized nature of aircraft support can also introduce risks related to obsolescence, supply chain disruptions, or unforeseen technical challenges that could impact performance.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 86 S COBB DR, MARIETTA, GA, 30063

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $239,850,000

Exercised Options: $239,850,000

Current Obligation: $33,517,247

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Parent Contract

Parent Award PIID: HSBP1008D01906

IDV Type: IDC

Timeline