DoD's $141M ODIN Hardware Contract Awarded to Lockheed Martin with No Competition

Contract Overview

Contract Amount: $141,322,047 ($141.3M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2024-12-31

End Date: 2027-08-30

Contract Duration: 972 days

Daily Burn Rate: $145.4K/day

Competition Type: NOT COMPETED

Pricing Type: FIXED PRICE INCENTIVE

Sector: IT

Official Description: MAINTENANCE SYSTEMS OPERATIONAL DATA INTEGRATED NETWORK (ODIN) HARDWARE (MOHW) INDEFINITE-DELIVERY/INDEFINITE-QUANTITY (IDIQ) CONTRACT

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76108

State: Texas Government Spending

Plain-Language Summary

Department of Defense obligated $141.3 million to LOCKHEED MARTIN CORPORATION for work described as: MAINTENANCE SYSTEMS OPERATIONAL DATA INTEGRATED NETWORK (ODIN) HARDWARE (MOHW) INDEFINITE-DELIVERY/INDEFINITE-QUANTITY (IDIQ) CONTRACT Key points: 1. The Department of the Navy awarded a $141.3M IDIQ contract for ODIN Hardware to Lockheed Martin. 2. This contract was not competed, raising questions about price discovery and potential value. 3. The fixed-price incentive contract type aims to balance cost and performance, but lack of competition limits benchmarks. 4. The sector is Aircraft Manufacturing, with a significant portion of spending in Texas.

Value Assessment

Rating: questionable

The contract's value is substantial at $141.3M. However, without competition, it's difficult to assess if the pricing is optimal compared to similar systems or potential alternatives.

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 may result in higher costs for taxpayers as there was no competitive pressure to drive down prices.

Taxpayer Impact: The lack of competition for a contract of this size could lead to suboptimal pricing, potentially increasing the financial burden on taxpayers.

Public Impact

Taxpayers may be overpaying due to the absence of competitive bidding. The Department of the Navy relies on Lockheed Martin for critical ODIN hardware. The contract duration extends to August 2027, impacting long-term budget planning.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition
Sole-source award
Potential for overpayment

Positive Signals

Fixed-price incentive contract type
Long contract duration provides stability

Sector Analysis

This contract falls within the Aircraft Manufacturing sector, specifically for maintenance systems operational data. Spending benchmarks in this niche area are hard to establish without competitive data, but the overall DoD spending in IT and related hardware is significant.

Small Business Impact

The data indicates this contract was not awarded to small businesses, as both the 'ss' and 'sb' fields are false. Further analysis would be needed to determine if subcontracting opportunities exist for small businesses.

Oversight & Accountability

The lack of competition raises concerns about oversight. Robust oversight is crucial to ensure fair pricing and performance when a sole-source contract is awarded, especially for a significant amount.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Department of the Navy Programs

Risk Flags

Sole-source award limits price competition.
Potential for inflated costs due to lack of bidding.
Limited transparency on contractor's cost structure.
No clear indication of small business subcontracting.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $141.3 million to LOCKHEED MARTIN CORPORATION. MAINTENANCE SYSTEMS OPERATIONAL DATA INTEGRATED NETWORK (ODIN) HARDWARE (MOHW) INDEFINITE-DELIVERY/INDEFINITE-QUANTITY (IDIQ) CONTRACT

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 $141.3 million.

What is the period of performance?

Start: 2024-12-31. End: 2027-08-30.

What specific justifications were provided for awarding this contract on a sole-source basis, and how do they align with federal procurement regulations?

Federal procurement regulations typically allow for sole-source awards under specific circumstances, such as when only one responsible source can provide the required supplies or services. The justification would need to detail why other potential contractors could not meet the requirements for the ODIN Hardware, potentially citing unique capabilities, proprietary technology, or urgent needs. A thorough review of the justification is necessary to ensure compliance and prevent potential abuse.

What is the estimated cost savings or premium associated with this sole-source award compared to a competitive procurement process?

Quantifying the exact cost difference without a competitive process is challenging. However, studies and historical data suggest that competitive procurements can yield savings ranging from 10% to 30% or more compared to sole-source awards. The absence of bidding pressure on this $141.3M contract likely means taxpayers are paying a premium, the magnitude of which depends on Lockheed Martin's cost structure and market power.

How will the Department of the Navy ensure effective performance and fair pricing throughout the life of this contract without the leverage of competition?

Effective oversight mechanisms are critical. This includes rigorous performance monitoring against defined metrics, regular audits of costs and pricing, and clear communication channels with the contractor. The fixed-price incentive structure should incentivize performance, but the Navy must actively manage contract modifications and ensure that any price adjustments are fully justified and reflect true value.

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: ONLY ONE SOURCE

Pricing Type: FIXED PRICE INCENTIVE (L)

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: $141,322,047

Exercised Options: $141,322,047

Current Obligation: $141,322,047

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001922D0004

IDV Type: IDC

Timeline