DoD awards $67.5M for TOMAHAWK Weapons Control System to Lockheed Martin, raising concerns about competition
Contract Overview
Contract Amount: $67,552,475 ($67.6M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2010-06-24
End Date: 2017-11-30
Contract Duration: 2,716 days
Daily Burn Rate: $24.9K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: TACTICAL TOMAHAWK WEAPONS CONTROL SYSTEM
Place of Performance
Location: KING OF PRUSSIA, MONTGOMERY County, PENNSYLVANIA, 19406
Plain-Language Summary
Department of Defense obligated $67.6 million to LOCKHEED MARTIN CORPORATION for work described as: TACTICAL TOMAHAWK WEAPONS CONTROL SYSTEM Key points: 1. Significant contract value for a specialized defense system. 2. Sole-source award to Lockheed Martin limits competitive pricing. 3. Potential for cost overruns due to Cost Plus Fixed Fee structure. 4. Sector is critical for naval defense capabilities.
Value Assessment
Rating: questionable
The contract value of $67.5M for the TOMAHAWK WEAPONS CONTROL SYSTEM is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential market alternatives or previous iterations.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Lockheed Martin Corporation. This lack of competition limits price discovery and may lead to higher costs for the government.
Taxpayer Impact: The absence of competition for this critical defense system means taxpayers may be paying a premium, as there was no market pressure to drive down costs.
Public Impact
Ensures continued operational capability for the TOMAHAWK missile system. Supports advanced naval warfare capabilities for the U.S. Navy. Potential for long-term reliance on a single supplier for critical components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of small business participation indicated
Positive Signals
- Critical defense system
- Established contractor
Sector Analysis
This contract falls within the Defense sector, specifically related to missile systems and their control. Spending in this area is driven by national security needs and technological advancements, often involving high-value, specialized components.
Small Business Impact
The data indicates no specific small business participation for this contract. Given the specialized nature of the TOMAHAWK WEAPONS CONTROL SYSTEM and the sole-source award, opportunities for small businesses may have been limited or not explicitly tracked.
Oversight & Accountability
The Department of the Navy awarded this contract. Oversight would focus on ensuring the contractor meets performance requirements within the agreed-upon cost structure, especially given the cost-plus nature of the award.
Related Government Programs
- Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Cost-plus contract type may lead to overruns
- Potential for vendor lock-in
- Limited transparency on pricing justification
Tags
other-guided-missile-and-space-vehicle-p, department-of-defense, pa, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $67.6 million to LOCKHEED MARTIN CORPORATION. TACTICAL TOMAHAWK WEAPONS CONTROL SYSTEM
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $67.6 million.
What is the period of performance?
Start: 2010-06-24. End: 2017-11-30.
What is the rationale behind the sole-source award for the TOMAHAWK WEAPONS CONTROL SYSTEM, and were alternatives explored?
The rationale for a sole-source award typically involves unique capabilities, proprietary technology, or urgent needs where only one source can fulfill the requirement. For the TOMAHAWK system, it might stem from its highly specialized nature and integration with existing platforms. However, without further documentation, it's unclear if less restrictive methods were considered or if this was a long-standing sole-source arrangement.
How does the Cost Plus Fixed Fee (CPFF) contract type impact cost control and potential overruns for this system?
CPFF contracts are designed to provide incentives for efficiency while allowing the contractor to recover costs. However, they can lead to cost overruns if the initial cost estimates are inaccurate or if unforeseen technical challenges arise. The government bears the risk of cost increases, making robust oversight crucial to manage expenditures and ensure value for money.
What is the long-term strategic implication of awarding such a critical system on a sole-source basis?
Sole-source awards for critical systems can lead to vendor lock-in, potentially stifling innovation and increasing long-term costs due to a lack of competition. It also raises concerns about supply chain resilience and the government's ability to pivot to alternative technologies or suppliers if needed. Strategic sourcing reviews are essential to mitigate these risks.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0001910R0007
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 230 MALL BLVD, KING OF PRUSSIA, PA, 19406
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: $68,068,978
Exercised Options: $68,068,978
Current Obligation: $67,552,475
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2010-06-24
Current End Date: 2017-11-30
Potential End Date: 2017-11-30 00:00:00
Last Modified: 2017-10-25
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