DoD's $32M contract for air transportation support awarded to Lockheed Martin, with limited competition

Contract Overview

Contract Amount: $32,092,769 ($32.1M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2022-01-01

End Date: 2023-09-29

Contract Duration: 636 days

Daily Burn Rate: $50.5K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: PROGRAM, MAINTENANCE AND LOGISTICS - 2022 COVERAGE

Plain-Language Summary

Department of Defense obligated $32.1 million to LOCKHEED MARTIN CORPORATION for work described as: PROGRAM, MAINTENANCE AND LOGISTICS - 2022 COVERAGE Key points: 1. Value for money is difficult to assess due to lack of detailed cost breakdowns and limited competition. 2. Competition dynamics show a sole-source award, raising concerns about potential overpricing and reduced innovation. 3. Risk indicators include reliance on a single contractor and the absence of a competitive bidding process. 4. Performance context is provided by the contract duration and delivery order type, suggesting ongoing support. 5. Sector positioning places this contract within the broader defense logistics and support services market.

Value Assessment

Rating: questionable

The contract's value of $32 million over its period of performance is substantial. However, without comparable contract data or detailed cost breakdowns, it's challenging to benchmark the value for money. The sole-source nature of the award also raises questions about whether the pricing reflects competitive market rates or if there is an opportunity for cost savings through a more open competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not openly competed. This approach limits the number of potential bidders and can reduce the pressure on pricing and innovation. The lack of competition means that the government did not explore alternative solutions or pricing from a wider range of vendors.

Taxpayer Impact: Sole-source awards can lead to higher costs for taxpayers as the government may not be getting the best possible price due to the absence of competitive pressure.

Public Impact

The Department of Defense, specifically the Department of the Navy, is the primary beneficiary of these services. Services delivered include 'Other Support Activities for Air Transportation', crucial for military aviation operations. The geographic impact is likely focused on military installations where air transportation support is required. Workforce implications may involve specialized personnel for logistics and maintenance, potentially including contractor employees.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pricing and potentially increases costs for taxpayers.
Lack of transparency in the justification for sole-source award.
Absence of small business subcontracting opportunities due to sole-source nature.

Positive Signals

Contract awarded to a known entity (Lockheed Martin) with established capabilities.
Contract duration indicates a need for sustained support, suggesting a critical function.
Firm Fixed Price contract type provides cost certainty for the government.

Sector Analysis

This contract falls within the aerospace and defense sector, specifically focusing on support services for air transportation. The market for such services is significant, driven by the operational needs of military branches. Comparable spending benchmarks would typically involve other contracts for aviation maintenance, logistics, and operational support within the DoD and other government agencies.

Small Business Impact

As this contract was awarded on a sole-source basis, there is no indication of small business set-aside provisions. Consequently, opportunities for small businesses to participate as prime contractors or through subcontracting are likely limited. This approach bypasses the typical mechanisms designed to foster small business participation in federal contracting.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Navy's contracting and program management offices. Accountability measures would be defined by the contract terms and performance metrics. Transparency is limited due to the sole-source nature and the absence of publicly available detailed justifications. Inspector General jurisdiction would apply if any fraud, waste, or abuse is suspected.

Related Government Programs

Department of Defense Logistics Support Contracts
Air Mobility Command Services
Naval Aviation Maintenance Programs
Defense Contract Management Agency Oversight

Risk Flags

Sole-source award raises concerns about competition and potential cost overruns.
Lack of detailed justification for sole-source award limits transparency.
Absence of small business subcontracting opportunities.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $32.1 million to LOCKHEED MARTIN CORPORATION. PROGRAM, MAINTENANCE AND LOGISTICS - 2022 COVERAGE

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 $32.1 million.

What is the period of performance?

Start: 2022-01-01. End: 2023-09-29.

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

The provided data indicates the contract was 'NOT AVAILABLE FOR COMPETITION'. This typically suggests that the agency determined only one source could fulfill the requirement. Common justifications include proprietary technology, urgent and compelling needs where competition is not feasible, or a lack of adequate sources. Without further details from the awarding agency (Department of the Navy), the precise reason remains unspecified. This lack of competition raises concerns about potential price inflation and limits the government's ability to explore alternative solutions or leverage market competition for better value.

How does the pricing of this contract compare to similar air transportation support services?

Direct comparison of pricing is difficult without access to detailed cost breakdowns and data on similar contracts awarded under competitive conditions. The sole-source nature of this award to Lockheed Martin means that the price was not vetted through a competitive bidding process. Therefore, it is challenging to ascertain if the 'FIRM FIXED PRICE' is optimal or if taxpayers are overpaying. Benchmarking against other sole-source awards for similar services might offer some insight, but a true value-for-money assessment would require competitive data.

What are the key performance indicators (KPIs) and service level agreements (SLAs) associated with this contract?

The provided data does not specify the key performance indicators (KPIs) or service level agreements (SLAs) for this contract. However, as a 'FIRM FIXED PRICE' contract for 'Other Support Activities for Air Transportation', it is expected to include metrics related to timeliness, quality of service, availability of support, and adherence to safety regulations. The 'DELIVERY ORDER' nature suggests specific tasks or periods of service are defined. The Department of the Navy would be responsible for monitoring Lockheed Martin's performance against these unstated but implied contractual obligations.

What is Lockheed Martin's track record with similar Department of Defense contracts?

Lockheed Martin is a major defense contractor with an extensive history of performing complex programs for the Department of Defense, including extensive work in aviation, logistics, and maintenance. While specific details on their performance for this particular type of 'Other Support Activities for Air Transportation' are not provided, their overall track record suggests they possess the technical capabilities and infrastructure to fulfill such requirements. However, past performance on other contracts, especially sole-source ones, should be reviewed for any red flags regarding cost overruns or performance issues.

What is the historical spending trend for this specific type of air transportation support within the Department of the Navy?

The provided data only includes information for a single contract award valued at approximately $32 million covering a period from January 1, 2022, to September 29, 2023. It does not offer historical spending trends for this specific category of 'Other Support Activities for Air Transportation' within the Department of the Navy. To analyze historical spending, one would need access to procurement data spanning multiple fiscal years, identifying similar contracts, their values, durations, and award types to discern patterns or changes in investment.

Industry Classification

NAICS: Transportation and Warehousing › Support Activities for Air Transportation › Other Support Activities for Air Transportation

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

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: $32,092,769

Exercised Options: $32,092,769

Current Obligation: $32,092,769

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001920D0001

IDV Type: IDC

Timeline