DoD Awards $115.8M Firm Fixed Price Contract for HMDS to Lockheed Martin
Contract Overview
Contract Amount: $115,782,307 ($115.8M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2020-05-07
End Date: 2025-03-31
Contract Duration: 1,789 days
Daily Burn Rate: $64.7K/day
Competition Type: NOT COMPETED
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: LOT 14 HMDS
Place of Performance
Location: FORT WORTH, TARRANT County, TEXAS, 76101
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $115.8 million to LOCKHEED MARTIN CORPORATION for work described as: LOT 14 HMDS Key points: 1. Significant award to a major defense contractor. 2. Lack of competition raises questions about price discovery. 3. Long contract duration (over 4 years) warrants close monitoring. 4. Sector: Defense - Aircraft Parts Manufacturing.
Value Assessment
Rating: questionable
The contract is a firm fixed price delivery order. Without competitive bidding, it's difficult to assess if the $115.8 million price is optimal or if it reflects market value. Benchmarking against similar contracts for HMDS components would be necessary.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This limits price discovery and potentially leads to higher costs for taxpayers as there was no competitive pressure to drive down prices.
Taxpayer Impact: The lack of competition suggests potential for overpayment, impacting taxpayer value.
Public Impact
Taxpayers may be paying a premium due to the absence of competitive bidding. The long-term nature of the contract could lock in potentially inflated prices. Dependence on a single supplier for critical aircraft parts could pose supply chain risks.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Long contract duration
Positive Signals
- Firm Fixed Price contract type can limit cost overruns if managed well.
Sector Analysis
This contract falls within the Defense sector, specifically for aircraft parts manufacturing. Spending in this area is substantial, and competitive procurement is crucial for ensuring cost-effectiveness and technological advancement.
Small Business Impact
The awardee is Lockheed Martin Corporation, a large business. There is no indication that small businesses were involved in this specific contract, either as prime contractors or subcontractors.
Oversight & Accountability
Oversight is critical for sole-source contracts to ensure fair pricing and performance. The Department of the Navy's contracting activity needs robust mechanisms to monitor costs and ensure the delivery of required parts.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source procurement
- Potential for inflated pricing
- Limited transparency in price justification
- Long-term commitment without competition
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, tx, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $115.8 million to LOCKHEED MARTIN CORPORATION. LOT 14 HMDS
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 $115.8 million.
What is the period of performance?
Start: 2020-05-07. End: 2025-03-31.
What is the justification for the sole-source award of this HMDS contract?
The justification for a sole-source award typically involves factors such as unique capabilities, urgent need, or lack of viable alternatives. Without further details on the specific HMDS components and their availability, it's difficult to ascertain the precise reason. However, sole-source awards inherently bypass competitive processes, which are designed to ensure the best value for the government.
What are the potential risks associated with a sole-source contract for aircraft parts?
Sole-source contracts for critical aircraft parts carry risks including higher costs due to lack of competition, potential for complacency from the supplier, and limited flexibility if requirements change. There's also a risk of vendor lock-in, making it difficult to switch suppliers even if better options emerge. This can impact long-term affordability and readiness.
How can the Department of the Navy ensure value for money on this contract?
To ensure value, the Department of the Navy should implement rigorous oversight, including detailed cost analysis and performance monitoring. Regular reviews of market prices for similar components and engaging with industry experts can help validate the pricing. Establishing clear performance metrics and exercising options judiciously are also key to maximizing taxpayer value.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: AEROSPACE CRAFT AND STRUCTURAL COMPONENTS
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 1 LOCKHEED BLVD BLDG 10, FORT WORTH, TX, 76108
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: $115,782,307
Exercised Options: $115,782,307
Current Obligation: $115,782,307
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: N0001919D0015
IDV Type: IDC
Timeline
Start Date: 2020-05-07
Current End Date: 2025-03-31
Potential End Date: 2025-03-31 00:00:00
Last Modified: 2024-12-20
More Contracts from Lockheed Martin Corporation
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Department of Defense)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Department of Defense)
- THE Purpose of This Modification IS to Award F-35A Lrip 15 Usaf Aircraft* Long Lead Funding — $30.1B (Department of Defense)
- THE Purpose of This Contract IS to Award Long Lead Funding for F-35A, F-35B, and F-35C Aircraft for U.S. Services, Non-Dod Partners, and FMS Customers — $24.5B (Department of Defense)
- Lrip 11 AAC — $12.3B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)