DoD Awards Lockheed Martin $150M for P-3 Orion Airframe Components, Ending 2007
Contract Overview
Contract Amount: $149,619,945 ($149.6M)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 1998-07-08
End Date: 2007-08-30
Contract Duration: 3,340 days
Daily Burn Rate: $44.8K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: 199811!1700!1061!AC522!NAVAL AIR SYSTEMS COMMAND !N0001998C0013 !A!*!* !19980708!20020630!078669280!834951691!834951691!N!90536!LOCKHEED MARTIN CORPORATION !3333 PILOT KNOB RD !SAINT PAUL !MN!55121!17288!037!27!EAGAN !DAKOTA !MINNESOTA !0001!+000058440439!N!N!000000000000!1680!MSL AIRCRAFT ACCESSORIES AND COMPONENTS !A1A!AIRFRAMES AND SPARES !2APC!P-3 ORION !3728!3!*!*!*!B!A!*!D !N!V!1!001!N!1A!A!Y!Z!* !* !N!C!*!A!A!A!A!A!*!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: SAINT PAUL, DAKOTA County, MINNESOTA, 55121, UNITED STATES OF AMERICA
Plain-Language Summary
Department of Defense obligated $149.6 million to LOCKHEED MARTIN CORP for work described as: 199811!1700!1061!AC522!NAVAL AIR SYSTEMS COMMAND !N0001998C0013 !A!*!* !19980708!20020630!078669280!834951691!834951691!N!90536!LOCKHEED MARTIN CORPORATION !3333 PILOT KNOB RD !SAINT PAUL !MN!55121!17288!037!27!EAGAN !DAKOTA… Key points: 1. Significant contract value for aircraft components. 2. Sole-source award to Lockheed Martin raises competition concerns. 3. Long contract duration suggests potential for cost overruns. 4. Defense sector spending on legacy aircraft maintenance.
Value Assessment
Rating: concerning
The contract value of $149.6 million over its life is substantial. However, without comparable contracts or detailed cost breakdowns, assessing its value relative to similar procurements is difficult. The cost-plus-incentive-fee structure introduces risk.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded sole-source, meaning competition was not sought. This limits price discovery and potentially leads to higher costs for taxpayers. The justification for sole-source is not provided.
Taxpayer Impact: The lack of competition in this sole-source award likely results in a higher price than a competitively bid contract, impacting taxpayer funds negatively.
Public Impact
Taxpayers may be overpaying due to the absence of competitive bidding. The long duration of the contract could lead to unforeseen cost increases. Dependence on a single contractor for critical aircraft components poses a risk. The P-3 Orion is a legacy aircraft, raising questions about long-term sustainment costs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus-incentive-fee contract type
- Long contract duration
- Lack of competition justification
Positive Signals
- Awarded to a known defense contractor
- Contract supports critical defense assets
Sector Analysis
This contract falls within the Defense sector, specifically for aircraft components. Spending on legacy aircraft sustainment is common but can be costly. Benchmarks for similar component contracts are difficult to ascertain without more data.
Small Business Impact
There is no indication in the provided data that small businesses were involved in this contract, either as prime contractors or subcontractors. The award went directly to a large corporation.
Oversight & Accountability
The sole-source nature of this award warrants further oversight to ensure fair pricing and prevent potential waste. Accountability for cost control within the cost-plus-incentive-fee structure is crucial.
Related Government Programs
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Sole-source justification missing
- Long contract duration
- Limited transparency on pricing
Tags
department-of-defense, mn, dca, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $149.6 million to LOCKHEED MARTIN CORP. 199811!1700!1061!AC522!NAVAL AIR SYSTEMS COMMAND !N0001998C0013 !A!*!* !19980708!20020630!078669280!834951691!834951691!N!90536!LOCKHEED MARTIN CORPORATION !3333 PILOT KNOB RD !SAINT PAUL !MN!55121!17288!037!27!EAGAN !DAKOTA !MINNESOTA !0001!+000058440439!N!N!000000000000!1680!MSL AIRCRAFT ACCESSORIES AND COMPONENTS !A1A!AIRFRAMES AND SPARES !2APC!P-3 ORION !3728!3!*!*!*!B!A!*!D !N!V!1!0
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Defense Contract Management Agency).
What is the total obligated amount?
The obligated amount is $149.6 million.
What is the period of performance?
Start: 1998-07-08. End: 2007-08-30.
What was the specific justification for awarding this contract sole-source, and were any alternatives considered?
The provided data does not include the justification for the sole-source award. Typically, sole-source contracts are justified when only one responsible source can provide the required supplies or services. Without this information, it's impossible to assess if the government adequately explored competitive options or if this was a necessary procurement strategy.
How does the per-unit cost of these P-3 Orion airframe components compare to industry benchmarks or previous procurements?
The data does not provide per-unit cost information or allow for direct comparison to industry benchmarks or previous procurements. The total contract value and type (cost-plus-incentive-fee) suggest potential variability in final costs. A detailed cost analysis would be needed to assess unit cost reasonableness.
What is the long-term strategy for P-3 Orion sustainment, and does this contract align with it effectively?
The contract's duration (ending in 2007, awarded in 1998) suggests a long-term sustainment effort for the P-3 Orion fleet. However, without knowing the overall P-3 sustainment plan or the planned retirement of the aircraft, it's difficult to assess the effectiveness of this specific contract within that broader strategy. Continued investment in legacy platforms requires careful consideration.
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 3333 PILOT KNOB RD, SAINT PAUL, MN, 55121
Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Contract Characteristics
Cost or Pricing Data: YES
Timeline
Start Date: 1998-07-08
Current End Date: 2007-08-30
Potential End Date: 2007-08-30 00:00:00
Last Modified: 2015-06-01
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