DoD Awards Lockheed Martin $324.9M for AEGIS Engineering Services, Extending Contract to 2013
Contract Overview
Contract Amount: $324,887,213 ($324.9M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2000-06-02
End Date: 2013-10-19
Contract Duration: 4,887 days
Daily Burn Rate: $66.5K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS AWARD FEE
Sector: Defense
Official Description: 200009!1700!002724!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002400C5139 !A!*!* !20000602!20020531!848028494!834951691!834951691!N!02769!LOCKHEED MARTIN CORPORATION !199 BORTON LANDING ROAD !MOORESTOWN !NJ!08057!47850!005!34!MOORESTOWN !BURLINGTON !NEW JERSEY!0001!+000004791859!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A3 !SHIPS !2CNZ!CG-47 AEGIS !8711!3!*!*!*!B!A!*!D !U!R!1!001!N!1B!Z!Y!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!
Place of Performance
Location: MOORESTOWN, BURLINGTON County, NEW JERSEY, 08057
Plain-Language Summary
Department of Defense obligated $324.9 million to LOCKHEED MARTIN CORPORATION for work described as: 200009!1700!002724!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002400C5139 !A!*!* !20000602!20020531!848028494!834951691!834951691!N!02769!LOCKHEED MARTIN CORPORATION !199 BORTON LANDING ROAD !MOORESTOWN !NJ!08057!47850!005!34!MOORESTOWN !BUR… Key points: 1. Significant contract value of $324.9 million awarded to a single large defense contractor. 2. Sole-source award raises concerns about competition and potential overpricing. 3. Contract duration of nearly 13 years suggests long-term reliance and potential for cost creep. 4. Focus on IT and engineering services within the Defense sector.
Value Assessment
Rating: questionable
The contract's total value is substantial, but without comparable contracts or detailed cost breakdowns, assessing its value for money is difficult. The long duration and sole-source nature suggest potential for inflated costs over time.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This was a sole-source award, meaning there was no competitive bidding process. This significantly limits price discovery and may lead to higher costs for taxpayers as the contractor faces less pressure to offer competitive pricing.
Taxpayer Impact: The lack of competition in this large sole-source contract likely results in higher costs for taxpayers compared to a competitively bid contract.
Public Impact
Taxpayers may be overpaying for critical defense engineering services due to the lack of competition. Long-term contract could lock the government into a specific technology or vendor, limiting future flexibility. Potential impact on innovation if alternative solutions are not explored through competitive processes.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Long contract duration
- Lack of transparency in pricing
- No small business participation noted
Positive Signals
- Award to established contractor with proven capabilities
- Supports critical defense systems (AEGIS)
Sector Analysis
This contract falls within the Defense sector, specifically for engineering and technical services related to the AEGIS combat system. Spending benchmarks in this area are highly variable, but large sole-source contracts warrant scrutiny.
Small Business Impact
The provided data does not indicate any small business participation in this contract. This sole-source award to a large corporation suggests a missed opportunity to engage small businesses in the defense supply chain.
Oversight & Accountability
The sole-source nature of this award raises questions about the justification for not seeking competitive bids. Further oversight is needed to ensure the pricing is fair and reasonable given the lack of competition.
Related Government Programs
- Other Electronic Component Manufacturing
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Sole-source award lacks competition
- Extended contract duration may lead to cost overruns
- Potential for vendor lock-in
- Limited transparency on pricing justification
- No indication of small business involvement
Tags
other-electronic-component-manufacturing, department-of-defense, nj, definitive-contract, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $324.9 million to LOCKHEED MARTIN CORPORATION. 200009!1700!002724!BZ005 !NAVAL SEA SYSTEMS COMMAND !N0002400C5139 !A!*!* !20000602!20020531!848028494!834951691!834951691!N!02769!LOCKHEED MARTIN CORPORATION !199 BORTON LANDING ROAD !MOORESTOWN !NJ!08057!47850!005!34!MOORESTOWN !BURLINGTON !NEW JERSEY!0001!+000004791859!N!N!000000000000!R425!ENGINEERING TECHNICAL SERVICES !A3 !SHIPS !2CNZ!CG-47 AEGIS !8711!3!*!*!*!B!A!*!D !U!R!
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 $324.9 million.
What is the period of performance?
Start: 2000-06-02. End: 2013-10-19.
What was the justification for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
The justification for a sole-source award typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without specific documentation, it's difficult to ascertain the exact reasoning. However, for a contract of this magnitude and duration, a thorough review of competitive alternatives is usually expected to ensure the best value for the government and taxpayers.
How does the per-unit cost or overall pricing compare to similar engineering services contracts, especially those awarded competitively?
Benchmarking this contract's pricing is challenging without access to detailed cost data and comparable contracts. Sole-source awards often lack the transparent pricing mechanisms found in competitive bids. A comparative analysis against similar, competitively procured services would be necessary to determine if the government received fair market value.
What mechanisms are in place to ensure cost control and performance effectiveness throughout the contract's extended duration?
Given the contract's length (nearly 13 years from award to final completion), robust oversight mechanisms are crucial. This includes regular performance reviews, audits, and potentially contract modifications to ensure costs remain reasonable and deliverables meet evolving requirements. The Cost Plus Award Fee structure suggests incentives for performance, but diligent monitoring is still essential.
Industry Classification
NAICS: Manufacturing › Semiconductor and Other Electronic Component Manufacturing › Other Electronic Component Manufacturing
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS AWARD FEE (R)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 199 BORTON LANDING ROAD, MOORESTOWN, NJ, 08057
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2000-06-02
Current End Date: 2013-10-19
Potential End Date: 2013-10-19 00:00:00
Last Modified: 2022-06-21
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