DoD Awards $835M Contract to Lockheed Martin for MH-60R Helicopter Components
Contract Overview
Contract Amount: $206,912,098 ($206.9M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2004-07-29
End Date: 2011-08-31
Contract Duration: 2,589 days
Daily Burn Rate: $79.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: 200411!000045!1700!AC524 !NAVAL AIR SYSTEMS COMMAND !N0001904C0113 !A!N! !N! ! !20040729!20050228!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE RT 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOGA !NEW YORK !+000014802652!N!N!000014802652!1520!AIRCRAFT ROTARY WING !A1C!OTHER AIRCRAFT EQUIPMENT !191 !MH-60R !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !D!U!J!1!001!N!1A!A!Y!A! ! !N!C!N! ! ! !A!A!A!A!000!A!B!N! ! ! !Y! ! !0001! !
Place of Performance
Location: OWEGO, TIOGA County, NEW YORK, 13827
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $206.9 million to LOCKHEED MARTIN CORPORATION for work described as: 200411!000045!1700!AC524 !NAVAL AIR SYSTEMS COMMAND !N0001904C0113 !A!N! !N! ! !20040729!20050228!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE RT 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOG… Key points: 1. Significant contract value highlights major defense spending. 2. Sole-source award raises questions about competition and price discovery. 3. Potential for cost overruns or inefficiencies due to lack of competition. 4. Focus on aircraft components indicates ongoing defense modernization efforts.
Value Assessment
Rating: questionable
The contract value of $834,951,691 is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value for the aircraft components.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, meaning only one vendor, Lockheed Martin, was considered. This limits price discovery and may lead to higher costs for taxpayers.
Taxpayer Impact: The lack of competition in this large sole-source award could result in taxpayers paying more than necessary for essential aircraft components.
Public Impact
Taxpayers may be overpaying for critical helicopter parts due to the absence of competitive bidding. The long duration of the contract (over 7 years) increases the risk of price escalation. Dependence on a single supplier for these components could create supply chain vulnerabilities.
Waste & Efficiency Indicators
Waste Risk Score: 75 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of price competition
Positive Signals
- Essential defense procurement
- Established supplier relationship
Sector Analysis
This contract falls within the Defense sector, specifically for aircraft components. Defense spending on specialized equipment like helicopter parts is a significant portion of the federal budget.
Small Business Impact
There is no indication in the provided data that small businesses were involved in this sole-source contract, either as prime contractors or subcontractors.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure that Lockheed Martin is delivering components at a reasonable cost and meeting all contractual requirements.
Related Government Programs
- Aircraft Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award limits competition.
- Potential for inflated pricing.
- Long contract duration increases risk.
- Lack of transparency in price negotiation.
- Dependency on a single supplier.
Tags
aircraft-manufacturing, department-of-defense, ny, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $206.9 million to LOCKHEED MARTIN CORPORATION. 200411!000045!1700!AC524 !NAVAL AIR SYSTEMS COMMAND !N0001904C0113 !A!N! !N! ! !20040729!20050228!002232973!002232973!834951691!N!LOCKHEED MARTIN CORPORATION !1801 STATE RT 17C !OWEGO !NY!13827!55882!107!36!OWEGO !TIOGA !NEW YORK !+000014802652!N!N!000014802652!1520!AIRCRAFT ROTARY WING !A1C!OTHER AIRCRAFT EQUIPMENT !191 !MH-60R !336411!E! !3! ! ! ! ! !999
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 $206.9 million.
What is the period of performance?
Start: 2004-07-29. End: 2011-08-31.
What is the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or a lack of viable alternative sources. Without further documentation, it's unclear if these criteria were met, raising concerns about potential missed savings from competition.
How does the per-unit cost of these components compare to similar items procured competitively?
As this was a sole-source award, direct per-unit cost comparisons with competitively procured items are difficult. A thorough audit would be needed to benchmark these costs against industry standards and identify any potential overpricing.
What measures are in place to ensure the effectiveness and timely delivery of these critical helicopter components under a sole-source arrangement?
Oversight mechanisms such as performance metrics, regular progress reports, and quality assurance inspections are crucial. The Naval Air Systems Command must actively monitor Lockheed Martin's performance to ensure the components meet specifications and are delivered on schedule.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
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: 1801 STATE RT 17C, OWEGO, NY, 23
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 2004-07-29
Current End Date: 2011-08-31
Potential End Date: 2011-08-31 00:00:00
Last Modified: 2012-08-06
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