Lockheed Martin awarded $52M for MH-60R Seahawk program support, extending critical EW and logistics services

Contract Overview

Contract Amount: $52,017,651 ($52.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2025-01-01

End Date: 2026-07-31

Contract Duration: 576 days

Daily Burn Rate: $90.3K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: RAN TLS 2025 PROGRAM MANAGEMENT, MAINTENANCE AND LOGISTICS SUPPORT, ELECTRONIC WARFARE SUPPORT, SUPPORT AND TEST EQUIPMENT SUPPORT, PLANNED MAINTENANCE INTERVALS AND ASSOCIATED GST FOR CY25 - RAN MH60R PROGRAM

Place of Performance

Location: OWEGO, TIOGA County, NEW YORK, 13827

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $52.0 million to LOCKHEED MARTIN CORPORATION for work described as: RAN TLS 2025 PROGRAM MANAGEMENT, MAINTENANCE AND LOGISTICS SUPPORT, ELECTRONIC WARFARE SUPPORT, SUPPORT AND TEST EQUIPMENT SUPPORT, PLANNED MAINTENANCE INTERVALS AND ASSOCIATED GST FOR CY25 - RAN MH60R PROGRAM Key points: 1. Contract provides essential program management, maintenance, and logistics for the MH-60R Seahawk, a key naval asset. 2. Focus on electronic warfare support and test equipment indicates a need for advanced capabilities. 3. The contract duration of over 1.5 years suggests a stable, ongoing requirement for these services. 4. Fixed-price contract type aims to control costs, but requires careful monitoring of scope creep. 5. Sole-source award raises questions about competition and potential cost efficiencies. 6. Geographic location in New York may impact local economic and workforce considerations.

Value Assessment

Rating: fair

The contract value of $52 million over approximately 1.5 years for program management, maintenance, and logistics support for a critical naval platform appears within a reasonable range for such specialized services. However, without direct comparable contract data for the MH-60R program's specific maintenance and EW support, a precise value-for-money assessment is challenging. The firm fixed-price structure is a positive indicator for cost control, but the absence of competition limits the ability to benchmark against market rates or identify potential savings.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed. This approach is typically used when only one responsible source can provide the required services, often due to proprietary technology, unique capabilities, or urgent needs. The lack of competition means that the government did not benefit from a bidding process that could have driven down prices through market forces or offered a wider range of technical solutions.

Taxpayer Impact: The absence of competition for this $52 million contract means taxpayers may not have received the best possible price. Without competing offers, there is a risk that the awarded price is higher than it would have been in a competitive environment.

Public Impact

The U.S. Navy's MH-60R Seahawk program benefits directly, ensuring operational readiness of a critical helicopter platform. Services include program management, maintenance, logistics, and electronic warfare support, crucial for mission effectiveness. The contract supports specialized technical expertise and skilled labor within the defense sector. Operations are based in New York, potentially impacting the local economy and defense industry presence in the region.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings for taxpayers.
Reliance on a single contractor for critical support functions could create vendor lock-in.
Potential for scope creep in program management and logistics without competitive pressure.

Positive Signals

Firm fixed-price contract type provides cost certainty for the government.
Contract addresses essential maintenance and electronic warfare capabilities for a vital naval asset.
Longer-term support ensures operational continuity for the MH-60R program.

Sector Analysis

This contract falls within the broader aerospace and defense sector, specifically supporting rotary-wing aircraft operations and maintenance. The MH-60R Seahawk is a widely used maritime helicopter, and contracts for its sustainment are critical for maintaining naval aviation readiness. Spending in this area is influenced by geopolitical factors, defense budgets, and the operational tempo of naval forces. Comparable spending benchmarks would typically involve other major aircraft sustainment contracts, which often run into tens or hundreds of millions of dollars annually.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'ss': false and 'sb': false. Lockheed Martin Corporation is a large prime contractor. While the prime contract is not set aside for small businesses, there may be subcontracting opportunities for small businesses within the performance of this contract. However, the extent of such subcontracting is not detailed here and would require further investigation into Lockheed Martin's subcontracting plan.

Oversight & Accountability

Oversight for this contract is likely managed by the Defense Contract Management Agency (DCMA), which is responsible for ensuring contractor performance and compliance. The firm fixed-price nature of the contract provides a degree of cost control. Transparency regarding the sole-source justification and performance metrics would be key areas for oversight. Further accountability measures would typically be embedded within the contract terms and conditions, including reporting requirements and potential penalties for non-performance.

Related Government Programs

MH-60R Seahawk Helicopter Program
Naval Aviation Maintenance and Logistics Support
Electronic Warfare Systems Support
Defense Contractor Support Services

Risk Flags

Sole-source award
Potential for cost overruns without competition
Reliance on single contractor for critical support

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $52.0 million to LOCKHEED MARTIN CORPORATION. RAN TLS 2025 PROGRAM MANAGEMENT, MAINTENANCE AND LOGISTICS SUPPORT, ELECTRONIC WARFARE SUPPORT, SUPPORT AND TEST EQUIPMENT SUPPORT, PLANNED MAINTENANCE INTERVALS AND ASSOCIATED GST FOR CY25 - RAN MH60R PROGRAM

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $52.0 million.

What is the period of performance?

Start: 2025-01-01. End: 2026-07-31.

What is Lockheed Martin Corporation's track record with the MH-60R program and similar naval aviation support contracts?

Lockheed Martin Corporation is a primary contractor for the MH-60R Seahawk helicopter, involved in its production and sustainment. They have a long-standing relationship with the U.S. Navy for this platform, providing a range of services including logistics, maintenance, and upgrades. Their track record with the MH-60R program is generally considered extensive, given their role as the original equipment manufacturer and primary support provider. Historically, large defense contractors like Lockheed Martin have a complex record with government contracts, often involving significant value and long durations. While they possess deep technical expertise, oversight is crucial to ensure performance, cost control, and adherence to contract terms, especially in sole-source or limited-competition scenarios. Specific performance metrics for this particular contract would be detailed in internal government performance reports.

How does the $52 million value compare to previous or similar support contracts for the MH-60R program?

The $52 million value for this 18-month contract (approximately $34.7 million per year) for program management, maintenance, and logistics support for the MH-60R program appears to be in line with the expected costs for sustaining a complex naval aviation platform. Without access to specific historical contract data for the MH-60R program's sustainment, a precise comparison is difficult. However, similar contracts for major aircraft fleet support often range from tens to hundreds of millions of dollars annually, depending on the scope of services, number of aircraft supported, and specific maintenance requirements (e.g., depot-level maintenance, component repair, supply chain management). The firm fixed-price nature suggests a defined scope, but the sole-source award means direct price benchmarking against competitive bids is not possible for this specific award.

What are the primary risks associated with this sole-source contract award?

The primary risk associated with this sole-source contract award is the potential for higher costs due to the lack of competition. Without competing bids, the government may not be achieving the best possible price for the services rendered. Another risk is vendor lock-in, where the government becomes heavily reliant on Lockheed Martin for critical support, potentially limiting future flexibility or negotiation leverage. There's also a risk of scope creep, where the contractor might expand the scope of work beyond the original intent without the pressure of competitive alternatives, potentially increasing costs. Ensuring robust oversight and clear performance metrics becomes paramount to mitigate these risks and ensure value for taxpayer money.

How effective is the firm fixed-price contract type in managing costs for this type of support?

The firm fixed-price (FFP) contract type is generally considered effective in managing costs for well-defined services, such as program management, maintenance, and logistics support, as it shifts the risk of cost overruns to the contractor. This means the contractor is obligated to perform the specified work for the agreed-upon price, regardless of their actual costs. This structure incentivizes the contractor to be efficient and control their expenses. However, the effectiveness of FFP can be diminished if the scope of work is not clearly defined or if significant changes (scope creep) occur during the contract period. In a sole-source situation, while the price is fixed, the initial negotiation of that price is critical to ensure it reflects fair market value.

What are the implications of this contract for the operational readiness of the MH-60R Seahawk fleet?

This contract is crucial for maintaining the operational readiness of the MH-60R Seahawk fleet. The services provided—program management, maintenance, logistics support, and electronic warfare support—directly address the sustainment needs of these critical naval helicopters. By ensuring timely maintenance, availability of spare parts, and upkeep of complex systems like electronic warfare suites, the contract helps minimize downtime and maximize the fleet's availability for missions. The planned maintenance intervals and associated support are designed to keep the aircraft in optimal condition, thereby directly contributing to the Navy's ability to deploy and operate these assets effectively in various operational environments.

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

Address: 1801 STATE ROUTE 17C, 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: $52,017,651

Exercised Options: $52,017,651

Current Obligation: $52,017,651

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: N0001925D0016

IDV Type: IDC

Timeline