DoD Awards $1.08 Billion for PSEA I, D, S&S RDT&E to Lockheed Martin
Contract Overview
Contract Amount: $1,081,970,341 ($1.1B)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2009-01-09
End Date: 2015-09-30
Contract Duration: 2,455 days
Daily Burn Rate: $440.7K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: PSEA I,D,S&S YEAR ONE RDT&E
Place of Performance
Location: MOORESTOWN, BURLINGTON County, NEW JERSEY, 08057
Plain-Language Summary
Department of Defense obligated $1.08 billion to LOCKHEED MARTIN CORPORATION for work described as: PSEA I,D,S&S YEAR ONE RDT&E Key points: 1. Significant RDT&E investment in defense systems. 2. Sole-source award to Lockheed Martin suggests unique capabilities or limited alternatives. 3. Long contract duration (2009-2015) indicates a substantial, multi-year project. 4. High dollar value warrants scrutiny of cost-effectiveness and competition.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure can incentivize cost overruns. Without competitive bidding, it's difficult to benchmark pricing against market rates.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
The 'NOT COMPETED' status indicates a sole-source award, likely due to specialized requirements or a lack of viable alternatives. This limits price discovery and potentially increases costs for taxpayers.
Taxpayer Impact: The absence of competition may lead to higher prices than if multiple vendors had bid, impacting taxpayer value.
Public Impact
Taxpayers fund advanced research and development for defense systems. The award impacts the defense industrial base, specifically Lockheed Martin. Long-term funding commitment for a single contractor raises questions about strategic sourcing.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Cost-plus contract type
- Long contract duration
- High dollar value
Positive Signals
- Supports critical defense RDT&E
- Long-term partnership with a major defense contractor
Sector Analysis
This contract falls within the Engineering Services sector, specifically supporting defense research, development, testing, and evaluation. Spending in this area is substantial within the DoD budget, often involving complex, high-value contracts.
Small Business Impact
The data does not indicate any subcontracting to small businesses. The prime contractor is a large corporation, suggesting limited direct opportunities for small businesses on this specific contract.
Oversight & Accountability
The Department of Defense, through the Defense Contract Management Agency, is responsible for overseeing this contract. The sole-source nature necessitates robust oversight to ensure performance and cost control.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Defense Contract Management Agency Programs
Risk Flags
- Lack of competitive bidding
- Potential for cost overruns due to CPFF structure
- Limited transparency on pricing
- No indication of small business participation
Tags
engineering-services, department-of-defense, nj, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $1.08 billion to LOCKHEED MARTIN CORPORATION. PSEA I,D,S&S YEAR ONE RDT&E
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 $1.08 billion.
What is the period of performance?
Start: 2009-01-09. End: 2015-09-30.
What specific technical capabilities or national security needs justified a sole-source award for this significant RDT&E program?
Sole-source awards are typically justified when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting urgent national security requirements. For this PSEA program, the justification would likely detail the specialized nature of the research and development, potentially involving classified systems or highly integrated platforms where breaking down the work or finding alternatives would be impractical or detrimental to program goals.
How was the 'fixed fee' component determined in this Cost Plus Fixed Fee (CPFF) contract to ensure fair profit for the contractor and reasonable cost for the government?
In a CPFF contract, the fixed fee is negotiated upfront and represents the contractor's profit. It's typically based on factors like the complexity of the work, the contractor's historical performance, market rates for similar services, and the perceived risk. The government aims to set a fee that is sufficient to incentivize performance without being excessive, often using cost-realism analyses and benchmarking data to inform the negotiation.
What mechanisms were in place to track and manage costs effectively under this CPFF contract, given its substantial value and long duration?
Effective cost management for a large CPFF contract involves rigorous oversight by the Defense Contract Management Agency (DCMA). This includes regular audits of contractor expenditures, performance reviews, Earned Value Management (EVM) systems to track progress against cost and schedule, and strict adherence to reporting requirements. The agency would monitor direct and indirect costs, ensuring they align with the contract's scope and objectives to prevent cost overruns.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: COMM/DETECT/COHERENT RADIATION
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002408R5121
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 199 BORTON LANDING RD, MOORESTOWN, NJ, 08057
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $1,118,427,486
Exercised Options: $1,115,775,213
Current Obligation: $1,081,970,341
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2009-01-09
Current End Date: 2015-09-30
Potential End Date: 2015-09-30 00:00:00
Last Modified: 2025-11-03
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