DoD awards $76.6M for advanced radar processor retrofit kits, with Lockheed Martin as sole source

Contract Overview

Contract Amount: $76,586,322 ($76.6M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2020-02-13

End Date: 2026-02-26

Contract Duration: 2,205 days

Daily Burn Rate: $34.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: ADVANCED RADAR PROCESSOR RETROFIT KITS

Place of Performance

Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $76.6 million to LOCKHEED MARTIN CORPORATION for work described as: ADVANCED RADAR PROCESSOR RETROFIT KITS Key points: 1. Contract awarded on a sole-source basis, raising questions about price competition. 2. Long performance period of over 6 years suggests a significant, ongoing need. 3. The contract is for retrofit kits, indicating upgrades to existing systems. 4. No small business set-aside was applied, potentially limiting opportunities for smaller firms. 5. The fixed-price contract type shifts some risk to the contractor. 6. The North American Industry Classification System (NAICS) code 336413 points to aircraft parts manufacturing.

Value Assessment

Rating: questionable

Benchmarking the value of this sole-source contract is challenging without competitive bids. The total award of $76.6 million over approximately six years averages to about $12.7 million annually. Without comparable sole-source procurements or market research data, it's difficult to definitively assess if this represents fair and reasonable pricing. The lack of competition inherently limits the government's ability to secure the best possible price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Lockheed Martin Corporation, was solicited. The justification for sole-source procurement is not provided in the data, but it typically implies that only one responsible source is capable of meeting the government's needs. This lack of competition means the government did not benefit from a bidding process that could drive down prices.

Taxpayer Impact: Taxpayers may be paying a premium due to the absence of competitive pressure. Without multiple bids, there is less assurance that the price reflects the lowest achievable cost for these advanced radar processor retrofit kits.

Public Impact

The primary beneficiaries are likely the Department of the Navy, receiving upgraded radar systems for its aircraft. The services delivered involve the provision of advanced radar processor retrofit kits. The contract is associated with New York (ST: NY), suggesting potential manufacturing or delivery locations. Workforce implications may include specialized manufacturing and technical support roles within Lockheed Martin and its supply chain.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential savings.
Long contract duration could lead to cost overruns if not managed effectively.
Lack of small business participation may exclude innovative smaller suppliers.

Positive Signals

Firm Fixed Price contract shifts some cost risk to the contractor.
Retrofit kits suggest modernization of existing assets, potentially extending their useful life.
Award to a large, established defense contractor like Lockheed Martin may indicate a focus on proven technology and reliability.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on aircraft components and systems. The market for advanced radar technology is highly specialized, often dominated by a few large prime contractors. Spending on such upgrades is typical for maintaining and modernizing aging military fleets, ensuring technological superiority. Comparable spending benchmarks would likely be found within other major defense aircraft upgrade programs.

Small Business Impact

This contract was not set aside for small businesses, nor does it indicate any subcontracting requirements for small businesses. The sole-source nature of the award further limits the direct involvement of small businesses unless they are part of Lockheed Martin's supply chain. This could mean missed opportunities for small businesses specializing in radar components or related manufacturing.

Oversight & Accountability

Oversight for this contract would primarily fall under the Department of the Navy's contracting and program management offices. As a sole-source award, justification and approval processes would be critical oversight points. Transparency may be limited due to the non-competitive nature, but contract performance, delivery schedules, and payment milestones would be subject to standard government oversight and reporting requirements. Inspector General involvement would be triggered by any allegations of fraud, waste, or abuse.

Related Government Programs

Naval Aviation Modernization Programs
Advanced Radar Systems Procurement
Defense Contractor Sole-Source Awards
Aircraft Component Manufacturing
Lockheed Martin Defense Contracts

Risk Flags

Sole-source award lacks competitive justification.
Potential for inflated pricing due to lack of competition.
Long performance period increases exposure to cost and schedule risks.
No indication of small business participation or subcontracting.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $76.6 million to LOCKHEED MARTIN CORPORATION. ADVANCED RADAR PROCESSOR RETROFIT KITS

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 $76.6 million.

What is the period of performance?

Start: 2020-02-13. End: 2026-02-26.

What is the specific justification for awarding this contract on a sole-source basis to Lockheed Martin Corporation?

The provided data does not include the specific justification for the sole-source award. Typically, sole-source procurements are justified under circumstances such as unique capabilities, urgent needs, or when only one responsible source can fulfill the requirement. For a contract of this magnitude and duration, a detailed justification document, likely citing specific technical requirements or proprietary technology held by Lockheed Martin, would have been required and approved by the Department of Defense. Without access to this justification, it is impossible to fully assess the necessity of bypassing the competitive bidding process.

How does the pricing of these advanced radar processor retrofit kits compare to similar systems or previous procurements?

Direct price comparison is difficult due to the sole-source nature of this award and the lack of specific unit cost data or details on the exact technological specifications of the retrofit kits. Without competitive bids, there is no market benchmark established through this procurement. To assess value, one would need to compare the negotiated price against historical data for similar upgrades (if available), industry benchmarks for radar technology, or conduct a should-cost analysis. The firm fixed-price nature suggests the contractor bears cost overruns, but the initial price is key to value assessment.

What are the key performance indicators (KPIs) and risk mitigation strategies associated with this contract?

The provided data does not detail specific KPIs or risk mitigation strategies. However, for a contract involving advanced technology and a long performance period, typical KPIs would likely include on-time delivery of kits, system performance and reliability post-installation, and adherence to technical specifications. Risk mitigation strategies would normally involve detailed contract clauses, regular progress reviews, quality assurance checks, and potentially performance bonds. Given the sole-source award, the government's primary risk is paying an inflated price, which would ideally be managed through rigorous negotiation and oversight of the contractor's proposed costs.

What is the historical spending pattern for advanced radar processor retrofit kits within the Department of the Navy?

The provided data only pertains to this specific contract award valued at $76.6 million from February 2020 to February 2026. It does not offer historical spending patterns for similar items. To understand historical spending, one would need to query federal procurement databases (like FPDS or SAM.gov) for past contracts related to 'radar processor retrofit kits' or similar terms, issued by the Department of the Navy or other branches of the DoD. Analyzing trends in award values, quantities, and contractor types over several fiscal years would reveal spending patterns.

What is the potential impact of this contract on the broader aerospace and defense market, particularly concerning competition?

This sole-source award to Lockheed Martin reinforces the dominance of large, established defense contractors in specialized technology areas like advanced radar systems. It highlights a segment of the market where competition may be limited due to high barriers to entry (e.g., R&D costs, security clearances, existing platform integration). While beneficial for the awarded contractor, it can stifle innovation and limit opportunities for smaller, potentially more agile companies that might offer competitive solutions if given a chance. This pattern can contribute to market concentration within the defense industrial base.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: AEROSPACE CRAFT COMPONENTS AND ACCESSORIES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0001919B0021

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 1801 STATE RT 17 C, OWEGO, NY, 13827

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: $76,586,322

Exercised Options: $76,586,322

Current Obligation: $76,586,322

Actual Outlays: $13,996,920

Subaward Activity

Number of Subawards: 90

Total Subaward Amount: $35,573,018

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001919G0029

IDV Type: BOA

Timeline