Lockheed Martin awarded $44.5M for Multifunction Modular Masts, serving Navy's search and navigation needs

Contract Overview

Contract Amount: $44,519,892 ($44.5M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2019-06-21

End Date: 2026-08-31

Contract Duration: 2,628 days

Daily Burn Rate: $16.9K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: MULTIFUNCTION MODULAR MAST (MMM)

Place of Performance

Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $44.5 million to LOCKHEED MARTIN CORPORATION for work described as: MULTIFUNCTION MODULAR MAST (MMM) Key points: 1. The contract value represents a significant investment in advanced naval systems. 2. Competition dynamics for this specialized defense technology are crucial for ensuring fair pricing. 3. Performance risk is moderate, given the complexity of the systems and the contractor's experience. 4. This award positions Lockheed Martin as a key supplier for critical Navy operational capabilities. 5. The firm-fixed-price structure aims to control costs and provide budget certainty. 6. The duration of the contract suggests a long-term need for these systems.

Value Assessment

Rating: good

Benchmarking the value of this contract is challenging without specific performance metrics or detailed cost breakdowns. However, the $44.5 million award over approximately seven years for advanced naval systems suggests a potentially reasonable price point for specialized technology. Comparisons to similar contracts for radar or navigation systems would be necessary for a more precise assessment of value for money. The firm-fixed-price nature of the award indicates an effort to manage cost overruns.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple vendors had the opportunity to bid. This process is designed to foster a competitive environment, potentially leading to better pricing and innovation. The number of bidders is not specified, but the 'full and open' designation suggests a robust competition was sought.

Taxpayer Impact: Full and open competition generally benefits taxpayers by driving down prices through market forces and encouraging a wider range of solutions.

Public Impact

The U.S. Navy benefits from enhanced search, detection, and navigation capabilities for its vessels. This contract supports the development and delivery of advanced Multifunction Modular Masts. The geographic impact is primarily within the United States, with potential deployment on naval assets globally. Workforce implications include skilled labor in engineering, manufacturing, and systems integration within the defense sector.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns if unforeseen technical challenges arise, despite the firm-fixed-price structure.
Dependence on a single contractor for critical system components could pose supply chain risks.
Ensuring timely delivery and integration with existing naval platforms requires robust program management.

Positive Signals

Lockheed Martin's established track record in defense contracting provides a degree of confidence in execution.
The firm-fixed-price contract type offers cost certainty for the government.
Full and open competition suggests a market-driven price and potential for innovation.

Sector Analysis

The defense electronics and systems manufacturing sector is characterized by high barriers to entry, significant R&D investment, and long product lifecycles. Companies like Lockheed Martin are major players, often securing large, long-term contracts for specialized equipment. Spending in this area is driven by national security requirements and technological advancements in areas like radar, sensors, and communication systems. Comparable spending benchmarks would involve other large-scale defense system procurements.

Small Business Impact

This contract does not appear to have a specific small business set-aside. While Lockheed Martin is a large prime contractor, there may be opportunities for small businesses to participate as subcontractors, contributing specialized components or services. The extent of small business subcontracting will depend on the prime contractor's strategy and the specific needs of the contract.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Navy's contracting and program management offices. Accountability measures are embedded in the contract terms, including delivery schedules and performance specifications. Transparency is facilitated through contract award announcements and reporting requirements. The Inspector General for the Department of Defense may conduct audits or investigations as deemed necessary.

Related Government Programs

Naval Radar Systems
Defense Navigation and Guidance Systems
Military Communication Systems
Advanced Sensor Technology Procurement

Risk Flags

Potential for schedule slippage
Technical performance risk
Supply chain dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $44.5 million to LOCKHEED MARTIN CORPORATION. MULTIFUNCTION MODULAR MAST (MMM)

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 $44.5 million.

What is the period of performance?

Start: 2019-06-21. End: 2026-08-31.

What is Lockheed Martin's track record with similar naval system contracts?

Lockheed Martin Corporation has an extensive and well-documented history of delivering complex defense systems to the U.S. military, including the Navy. They are a prime contractor for numerous programs involving radar, sonar, electronic warfare, and command and control systems. Their experience with large-scale, multi-year contracts for naval platforms is substantial, often involving significant research, development, and production phases. While specific performance data for every contract is not publicly available, their consistent role as a major defense supplier indicates a generally strong capability in meeting government requirements, though like any large contractor, they have faced scrutiny and performance challenges on specific programs over their history.

How does the $44.5 million value compare to similar Multifunction Modular Mast procurements?

Direct comparisons for 'Multifunction Modular Masts' are difficult without more specific technical definitions and contract details, as this appears to be a specialized system. However, the award of $44.5 million over approximately seven years (2019-2026) suggests an average annual value of roughly $6.3 million. This figure can be benchmarked against other procurements for advanced radar, sensor suites, or integrated electronic systems for naval vessels. For instance, contracts for advanced radar systems can range from tens to hundreds of millions of dollars, depending on complexity, quantity, and integration requirements. The value here seems moderate for a critical, specialized component within the broader context of naval modernization programs.

What are the primary risks associated with this contract for the government?

The primary risks for the government in this contract include potential cost overruns if the firm-fixed-price structure proves insufficient to cover unforeseen technical challenges or material cost increases, although this structure is designed to mitigate that. There's also a risk of schedule delays, which could impact the Navy's operational readiness and modernization timelines. Technical risks, such as the system not performing to specifications or integration issues with existing naval platforms, are also present given the complexity of advanced defense systems. Finally, a sole-source or limited competition scenario (though this was full and open) could lead to reduced price competition and potentially higher costs over the contract's life if not managed carefully.

How effective is the 'full and open competition' strategy for this type of defense procurement?

The 'full and open competition' strategy is generally considered the most effective approach for government procurement when feasible, as it maximizes the potential for innovation, cost savings, and access to the widest range of qualified vendors. For specialized defense systems like the Multifunction Modular Mast, it ensures that the Department of the Navy explores all available technological solutions and competitive pricing. While it can sometimes lead to longer procurement cycles due to the evaluation process, the benefits of a competitive market—driving down prices and encouraging technological advancement—typically outweigh these drawbacks for taxpayers and national security. The success hinges on clear requirements and a fair evaluation process.

What is the historical spending trend for similar naval navigation and detection systems?

Historical spending on naval navigation, detection, and related systems has been substantial and generally increasing, driven by geopolitical factors, the need for technological superiority, and platform modernization efforts. The U.S. Navy consistently invests billions annually in advanced electronics, sensors, and combat systems. This includes radar, sonar, electronic warfare, and command and control capabilities, which are often integrated into complex platforms. Spending trends reflect a continuous cycle of upgrading existing systems and developing new ones to counter evolving threats and enhance operational effectiveness. Contracts for individual systems, like the one awarded to Lockheed Martin, represent components of this larger, ongoing investment in naval technological capabilities.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: FIRE CONTROL EQPT.

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: N0002419R6269

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 497 ELECTRONICS PKWY BLDG 5, LIVERPOOL, NY, 13088

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: $53,843,313

Exercised Options: $53,843,313

Current Obligation: $44,519,892

Actual Outlays: $1,412,192

Subaward Activity

Number of Subawards: 62

Total Subaward Amount: $185,552,724

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline