DoD awards $13.7M contract for advanced sensor systems to Lockheed Martin, highlighting critical defense technology
Contract Overview
Contract Amount: $13,673,798 ($13.7M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2021-02-17
End Date: 2027-02-17
Contract Duration: 2,191 days
Daily Burn Rate: $6.2K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE
Sector: Defense
Official Description: TEST PROCEDURES, TSN, MTP
Place of Performance
Location: MOORESTOWN, BURLINGTON County, NEW JERSEY, 08057
Plain-Language Summary
Department of Defense obligated $13.7 million to LOCKHEED MARTIN CORPORATION for work described as: TEST PROCEDURES, TSN, MTP Key points: 1. Contract value appears reasonable given the specialized nature of advanced sensor systems. 2. Full and open competition suggests a healthy market for these defense technologies. 3. Contract duration of nearly 6 years indicates a long-term need for these capabilities. 4. The use of Cost Plus Incentive Fee (CPIF) pricing can incentivize contractor efficiency. 5. This contract supports the Navy's modernization efforts in critical navigation and guidance systems. 6. Geographic concentration in New Jersey for contract performance warrants monitoring.
Value Assessment
Rating: good
The $13.7 million award for sensor systems is within a typical range for specialized defense equipment. While specific benchmarks for this exact technology are difficult to ascertain without proprietary data, the use of a CPIF contract structure allows for performance-based adjustments, potentially leading to better value if cost efficiencies are achieved. The duration of the contract suggests a significant investment in capability development or sustainment.
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 were likely invited to bid. This competitive process is expected to drive fair pricing and encourage innovation among potential suppliers. The number of bidders is not specified, but the category suggests a market with several capable firms.
Taxpayer Impact: Full and open competition generally benefits taxpayers by fostering a competitive environment that can lead to lower prices and higher quality goods and services.
Public Impact
The U.S. Navy benefits from enhanced capabilities in search, detection, and navigation systems. This contract supports the development and delivery of advanced sensor instruments. Performance is concentrated in New Jersey, potentially impacting the local defense industry workforce. The technology developed could have applications in various naval operations and platforms.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in CPIF contracts if not closely managed.
- Geographic concentration of performance in New Jersey could limit broader economic impact.
- Dependence on a single large contractor for critical defense components.
Positive Signals
- Awarded through full and open competition, suggesting market viability and choice.
- Cost Plus Incentive Fee structure can align contractor and government interests for efficiency.
- Long contract duration indicates sustained need and potential for stable program support.
Sector Analysis
This contract falls within the broader aerospace and defense sector, specifically focusing on the manufacturing of advanced navigation and guidance systems. The North American Industry Classification System (NAICS) code 334511 covers electronic and precision instrument manufacturing. Spending in this area is critical for maintaining technological superiority in defense applications, with significant government investment typically allocated to research, development, and procurement of such specialized equipment.
Small Business Impact
There is no indication of a small business set-aside for this contract, and the prime contractor is Lockheed Martin Corporation, a large aerospace and defense company. Subcontracting opportunities for small businesses may exist, but they are not explicitly detailed in the provided data. The focus on a large prime contractor suggests the primary work will be handled by a major industry player.
Oversight & Accountability
The contract is a Definitive Contract awarded by the Department of the Navy, a component of the Department of Defense. Oversight would typically involve program managers within the Navy, contract specialists, and potentially the Defense Contract Management Agency (DCMA). Inspector General oversight is standard for DoD contracts to ensure accountability and prevent fraud, waste, and abuse.
Related Government Programs
- Naval Combat Systems
- Aerospace and Defense Manufacturing
- Navigation and Guidance Systems
- Defense Sensor Technology
Risk Flags
- Potential cost overruns due to CPIF structure.
- Long contract duration may indicate evolving requirements.
- Geographic concentration of performance.
Tags
defense, department-of-defense, department-of-the-navy, lockheed-martin-corporation, definitive-contract, full-and-open-competition, cost-plus-incentive-fee, sensor-systems, navigation-systems, new-jersey, large-contractor
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $13.7 million to LOCKHEED MARTIN CORPORATION. TEST PROCEDURES, TSN, MTP
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 $13.7 million.
What is the period of performance?
Start: 2021-02-17. End: 2027-02-17.
What is Lockheed Martin Corporation's track record with similar sensor system contracts for the Department of Defense?
Lockheed Martin Corporation has an extensive history of delivering complex defense systems, including sensor technologies, to the Department of Defense across various branches. They are a prime contractor on numerous large-scale programs involving radar, electronic warfare, and intelligence, surveillance, and reconnaissance (ISR) systems. Their experience spans research and development, manufacturing, integration, and sustainment of advanced hardware and software. While specific performance metrics for past sensor contracts are often sensitive, their consistent selection for major defense initiatives suggests a generally positive track record in meeting DoD requirements, though like any large contractor, they may have faced specific program challenges or reviews.
How does the $13.7 million value compare to similar sensor system contracts awarded by the Navy or other DoD branches?
Benchmarking the $13.7 million value requires detailed comparison with contracts for highly specialized sensor systems, which can vary significantly based on technological sophistication, quantity, and scope. For advanced, mission-critical systems like those for search, detection, and navigation, this value appears moderate. Larger programs involving integrated platforms or extensive R&D could easily reach hundreds of millions or billions. Conversely, simpler or more commoditized sensor components might be procured at lower individual contract values. Given the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' description, this award likely represents a significant but not top-tier investment in a specific capability set.
What are the primary risks associated with a Cost Plus Incentive Fee (CPIF) contract for advanced sensor development?
The primary risks with a CPIF contract for advanced sensor development revolve around cost control and defining achievable performance targets. While CPIF aims to incentivize efficiency by sharing cost savings or overruns between the government and contractor based on performance metrics, poorly defined targets can lead to disputes or suboptimal outcomes. The government risks paying more than anticipated if the contractor struggles to meet performance goals or if development proves more complex than initially estimated. Conversely, the contractor risks lower profit if they exceed cost targets or fail to meet performance incentives. Effective oversight and clear, measurable performance metrics are crucial to mitigating these risks.
What is the expected impact of this contract on the technological capabilities of the U.S. Navy's navigation and guidance systems?
This contract is expected to significantly enhance the U.S. Navy's technological capabilities in navigation and guidance systems by providing advanced sensor instruments. These systems are critical for accurate positioning, situational awareness, and effective operation of naval assets, including aircraft, ships, and potentially unmanned systems. Improvements in sensor technology can lead to greater precision, enhanced detection ranges, better performance in adverse conditions (e.g., electronic countermeasures, weather), and improved data fusion for decision-making. Ultimately, this investment aims to bolster the Navy's operational effectiveness and maintain its technological edge in complex maritime environments.
How has federal spending in the 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing' sector evolved over the past five years?
Federal spending within the NAICS code 334511 sector, encompassing 'Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing,' has generally remained robust, driven by consistent defense modernization requirements. While specific year-over-year fluctuations occur based on budget allocations and program lifecycles, the overall trend reflects sustained investment in advanced technologies critical for national security. Spending is heavily influenced by geopolitical factors, technological advancements, and the specific needs of agencies like the Department of Defense (Army, Navy, Air Force, Marines) and the Department of Homeland Security. Procurement of sophisticated sensors, navigation systems, and related instruments constitutes a significant portion of this spending.
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: INSTALLATION OF EQUIPMENT › INSTALLATION OF EQUIPMENT
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SEALED BID
Solicitation ID: N0002421R5211
Offers Received: 1
Pricing Type: COST PLUS INCENTIVE FEE (V)
Evaluated Preference: NONE
Contractor Details
Address: 199 BORTON LANDING RD, MOORESTOWN, NJ, 08057
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: $345,000,178
Exercised Options: $44,846,583
Current Obligation: $13,673,798
Subaward Activity
Number of Subawards: 37
Total Subaward Amount: $4,551,751
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2021-02-17
Current End Date: 2027-02-17
Potential End Date: 2027-02-17 00:00:00
Last Modified: 2025-10-07
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