DoD Awards $179.5M Contract to Lockheed Martin for Electronic Components, Facing Limited Competition
Contract Overview
Contract Amount: $179,567,164 ($179.6M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2000-09-14
End Date: 2010-12-31
Contract Duration: 3,760 days
Daily Burn Rate: $47.8K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200012!1700!001531!AT727 !NAVAL AIR SYSTEMS COMMAND !N0001900C0480 !A!*!* !20000914!20050930!001690924!834951691!834951691!N!16331!LOCKHEED MARTIN CORPORATION !12506 LAKE UNDERHILL RD !ORLANDO !FL!32825!53000!095!12!ORLANDO !ORANGE !FLORIDA !0001!+000035507740!N!N!000000000000!5999!MISC ELECTRICAL & ELECTRONIC COMPONENTS !A7 !ELECTRONICS AND COMMUNICATION !2GHB!CASS !3699!3!*!*!*!B!A!*!A !N!J!2!002!B!* !A!N!F!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: ORLANDO, ORANGE County, FLORIDA, 32825
State: Florida Government Spending
Plain-Language Summary
Department of Defense obligated $179.6 million to LOCKHEED MARTIN CORPORATION for work described as: 200012!1700!001531!AT727 !NAVAL AIR SYSTEMS COMMAND !N0001900C0480 !A!*!* !20000914!20050930!001690924!834951691!834951691!N!16331!LOCKHEED MARTIN CORPORATION !12506 LAKE UNDERHILL RD !ORLANDO !FL!32825!53000!095!12!ORLANDO !ORA… Key points: 1. The contract, valued at $179.5 million, is for miscellaneous electrical and electronic components. 2. Lockheed Martin Corporation is the sole awardee, indicating a lack of broader competition. 3. The contract duration is 3760 days, spanning from 2000 to 2010. 4. The primary sector is Defense, with a specific focus on electronics and communication. 5. The contract type is Firm Fixed Price, which shifts cost risk to the contractor.
Value Assessment
Rating: fair
The contract value of $179.5 million for electronic components over a 10-year period appears substantial. Benchmarking against similar contracts for specialized electronic components is difficult without more detailed specifications, but the duration suggests a long-term supply agreement.
Cost Per Unit: N/A
Competition Analysis
Competition Level: limited
The contract was awarded under 'full and open competition' but only one offer was received from Lockheed Martin Corporation. This suggests that while the process was open, practical limitations or specific requirements may have restricted the number of viable bidders, potentially impacting price discovery.
Taxpayer Impact: While the contract was awarded through a competitive process, the limited number of actual bidders raises questions about whether the government secured the best possible price for taxpayers.
Public Impact
Taxpayers are funding the acquisition of critical electronic components for defense systems. The long contract duration implies a sustained need for these components within the Department of Defense. The reliance on a single contractor for a significant period could impact future supply chain resilience and innovation. The specific nature of the components (MISC ELECTRICAL & ELECTRONIC COMPONENTS) suggests they are vital for operational readiness.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Limited competition despite stated full and open process.
- Long contract duration (10 years) may lead to price escalation or obsolescence.
- Sole awardee raises concerns about market responsiveness and potential price gouging.
- Lack of detailed product description makes cost-effectiveness assessment difficult.
Positive Signals
- Firm Fixed Price contract shifts cost risk to the contractor.
- Awarded to a major defense contractor with established capabilities.
- Contract duration suggests a stable, long-term supply chain for critical components.
Sector Analysis
This contract falls within the Defense sector, specifically related to electronics and communication systems. Spending benchmarks for such specialized components are highly variable based on technological sophistication and volume, but $179.5 million over a decade indicates a significant procurement.
Small Business Impact
There is no indication that small businesses were involved in this contract award. The award went to a large corporation, Lockheed Martin, suggesting that opportunities for small business participation were either not pursued or not feasible under the contract's scope.
Oversight & Accountability
The contract was awarded by the Naval Air Systems Command, part of the Department of Defense. Oversight would typically involve contract management by the Defense Contract Management Agency to ensure compliance with terms and specifications. The long duration necessitates ongoing monitoring.
Related Government Programs
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Potential for overpayment due to limited competition.
- Risk of technological obsolescence over the contract's 10-year duration.
- Lack of transparency regarding specific components and their pricing.
- Sole awardee may reduce incentive for innovation and cost reduction.
- Dependency on a single large contractor for critical components.
Tags
department-of-defense, fl, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $179.6 million to LOCKHEED MARTIN CORPORATION. 200012!1700!001531!AT727 !NAVAL AIR SYSTEMS COMMAND !N0001900C0480 !A!*!* !20000914!20050930!001690924!834951691!834951691!N!16331!LOCKHEED MARTIN CORPORATION !12506 LAKE UNDERHILL RD !ORLANDO !FL!32825!53000!095!12!ORLANDO !ORANGE !FLORIDA !0001!+000035507740!N!N!000000000000!5999!MISC ELECTRICAL & ELECTRONIC COMPONENTS !A7 !ELECTRONICS AND COMMUNICATION !2GHB!CASS !3699!3!*!*!*!B!A!*!A !N!J!
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 $179.6 million.
What is the period of performance?
Start: 2000-09-14. End: 2010-12-31.
What specific electronic components were procured under this contract, and how do their costs compare to market rates for similar items?
The data identifies the procurement as 'MISC ELECTRICAL & ELECTRONIC COMPONENTS' under PSC code 5999. Without a detailed itemized list and specifications, a precise cost comparison is impossible. However, the $179.5 million value over ten years suggests a significant volume or high-value specialized items. Further analysis would require access to the contract's detailed line item data and market research reports.
Given the limited competition, what steps were taken to ensure the government received fair and reasonable pricing for these components?
Although the award states 'FULL AND OPEN COMPETITION', only one offer was received. Standard procedures for such situations typically involve rigorous price analysis, comparison with historical data, and potentially negotiation to ensure fair and reasonable pricing. The contracting officer's determination of price reasonableness would be documented, but the lack of competing offers inherently limits the government's leverage in price discovery.
How does the long duration of this contract impact the technological relevance and potential obsolescence of the procured electronic components?
A 10-year contract duration for electronic components carries a significant risk of technological obsolescence. While the Firm Fixed Price structure shifts financial risk, the government may end up with outdated technology if not managed proactively. Effective oversight would involve regular reviews of technological advancements and potential substitutions to mitigate obsolescence and ensure continued operational effectiveness.
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 12506 LAKE UNDERHILL RD, ORLANDO, FL, 90
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: NO
Timeline
Start Date: 2000-09-14
Current End Date: 2010-12-31
Potential End Date: 2010-12-31 00:00:00
Last Modified: 2012-07-31
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