DoD Awards $3.36B Fixed-Price Contract to Lockheed Martin for MMSC Design and Construction
Contract Overview
Contract Amount: $3,358,164,280 ($3.4B)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2018-03-02
End Date: 2029-02-28
Contract Duration: 4,016 days
Daily Burn Rate: $836.2K/day
Competition Type: NOT AVAILABLE FOR COMPETITION
Number of Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE
Sector: Defense
Official Description: MMSC DETAILED DESIGN AND CONSTRUCTION
Place of Performance
Location: MIDDLE RIVER, BALTIMORE County, MARYLAND, 21220
State: Maryland Government Spending
Plain-Language Summary
Department of Defense obligated $3.36 billion to LOCKHEED MARTIN CORPORATION for work described as: MMSC DETAILED DESIGN AND CONSTRUCTION Key points: 1. Significant investment in naval shipbuilding and repair. 2. Sole-source award to Lockheed Martin raises competition concerns. 3. Long-term contract duration (2018-2029) suggests substantial project scope. 4. High value contract requires robust oversight.
Value Assessment
Rating: questionable
The contract value of $3.36 billion is substantial. Without comparable contracts or detailed cost breakdowns, assessing its value for money is difficult. The fixed-price incentive structure aims to control costs, but the lack of competition is a primary concern.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating a lack of full and open competition. This approach may limit price discovery and potentially lead to higher costs for taxpayers.
Taxpayer Impact: The sole-source nature of this large contract raises concerns about potential overspending and the efficient use of taxpayer funds.
Public Impact
Impacts naval readiness and defense capabilities. Potential for job creation in shipbuilding and related industries. Long-term commitment of significant federal resources.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- High contract value
- Long contract duration
- Sole-source award
Positive Signals
- Potential for technological advancement in naval vessels
- Supports critical defense infrastructure
Sector Analysis
This contract falls within the shipbuilding and repair sector, a critical component of national defense. Spending in this sector is often characterized by high costs, long lead times, and significant government oversight due to the strategic importance and complexity of naval assets.
Small Business Impact
The contract data does not indicate any specific provisions or set-asides for small businesses. Given the sole-source nature and the prime contractor, opportunities for small businesses may be limited to subcontracting roles.
Oversight & Accountability
The substantial value and long duration of this contract necessitate rigorous oversight from the Department of the Navy to ensure performance, cost control, and adherence to contract terms. Regular reviews and audits are crucial.
Related Government Programs
- Ship Building and Repairing
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Sole-source award limits competitive pricing.
- High contract value increases financial risk.
- Long contract duration (over 10 years) poses execution risks.
- Potential for scope creep and cost escalation.
- Dependence on a single contractor for critical assets.
Tags
ship-building-and-repairing, department-of-defense, md, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $3.36 billion to LOCKHEED MARTIN CORPORATION. MMSC DETAILED DESIGN AND CONSTRUCTION
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 $3.36 billion.
What is the period of performance?
Start: 2018-03-02. End: 2029-02-28.
What specific factors justified the sole-source award to Lockheed Martin for the MMSC program?
The justification for a sole-source award typically involves unique capabilities, proprietary technology, or a lack of viable alternatives that meet specific national security requirements. Detailed documentation would be required to assess if these criteria were met and if alternatives were thoroughly explored.
How will the fixed-price incentive structure mitigate cost overruns given the lack of competition?
The fixed-price incentive (FPI) contract aims to share cost savings or overruns between the government and the contractor based on pre-defined targets and sharing ratios. While FPI provides some cost control, the absence of competitive bidding means the initial target price might be higher than in a competitive scenario.
What are the key performance indicators and milestones for this contract, and how are they being monitored?
Key performance indicators and milestones are critical for tracking progress and ensuring the successful delivery of the MMSC program. The Department of the Navy's oversight mechanisms, including regular progress reports, technical reviews, and potential site visits, are essential for monitoring adherence to the schedule and quality standards.
Industry Classification
NAICS: Manufacturing › Ship and Boat Building › Ship Building and Repairing
Product/Service Code: SHIPS, SMALL CRAFT, PONTOON, DOCKS
Competition & Pricing
Extent Competed: NOT AVAILABLE FOR COMPETITION
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0002418R2301
Offers Received: 1
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 2323 EASTERN BLVD, BALTIMORE, MD, 21220
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: $3,977,021,143
Exercised Options: $3,977,021,143
Current Obligation: $3,358,164,280
Subaward Activity
Number of Subawards: 1386
Total Subaward Amount: $20,484,341,883
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-03-02
Current End Date: 2029-02-28
Potential End Date: 2029-02-28 00:00:00
Last Modified: 2025-11-05
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