DoD Awards Lockheed Martin $148M for Strategic Systems Programs Missile and Space Systems Maintenance

Contract Overview

Contract Amount: $148,353,815 ($148.4M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 1999-12-16

End Date: 2006-12-22

Contract Duration: 2,563 days

Daily Burn Rate: $57.9K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE

Sector: Defense

Official Description: 200006!1700!00A037!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003000C0009 !A!*!* !19991216!20010315!075796037!834951691!834951691!N!80070!LOCKHEED MARTIN CORPORATION !55 CHARLES LINDBERG BLVD !GREAT NECK !NY!11020!30169!059!36!GREAT NECK !NASSAU !NEW YORK !0001!+000008581000!Y!N!000000000000!J019!MAINT & REPAIR OF EQ/SHIPS-SML CRAFT-DOCKS !A2 !MISSILE AND SPACE SYSTEMS !2CNJ!UGM-96 TRIDENT !3812!3!*!*!*!B!A!*!D !N!L!1!001!N!1A!A!Y!Z!* !* !N!C!*!A!A!A!A!A!A!* !*!N!A!C!N!*!*!*!*!*!

Place of Performance

Location: UNIONDALE, NASSAU County, NEW YORK, 11553

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $148.4 million to LOCKHEED MARTIN CORPORATION for work described as: 200006!1700!00A037!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003000C0009 !A!*!* !19991216!20010315!075796037!834951691!834951691!N!80070!LOCKHEED MARTIN CORPORATION !55 CHARLES LINDBERG BLVD !GREAT NECK !NY!11020!30169!059!36!GREAT NECK !NAS… Key points: 1. The contract focuses on maintenance and repair for missile and space systems, specifically the UGM-96 Trident. 2. Awarded to Lockheed Martin Corporation, a major defense contractor, indicating a reliance on established industry players. 3. The contract's fixed-price incentive structure aims to balance cost control with contractor performance. 4. The significant value suggests a critical role for these systems within the Department of Defense's strategic capabilities.

Value Assessment

Rating: good

The contract value of $148,353,814.81 for a 7-year period appears reasonable given the specialized nature of strategic missile systems maintenance. Benchmarking against similar complex defense systems maintenance contracts would provide further context.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, likely due to the specialized nature of the UGM-96 Trident missile systems and the proprietary knowledge required for their maintenance. This lack of competition may limit price discovery and potentially lead to higher costs.

Taxpayer Impact: The absence of competition suggests taxpayers may not be receiving the most cost-effective solution, though the criticality of the systems may justify the award to a sole provider.

Public Impact

Ensures the operational readiness of critical strategic missile systems, vital for national security. Supports high-skilled jobs within Lockheed Martin and its supply chain. Represents a significant investment in maintaining advanced defense technology.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to higher costs.
Long contract duration could mask inefficiencies.
Reliance on a single contractor for critical systems.

Positive Signals

Focus on critical strategic systems maintenance.
Incentive structure aims for performance.
Award to a known, experienced contractor.

Sector Analysis

This contract falls within the Defense sector, specifically related to missile and space systems. Spending in this area is typically high due to the advanced technology and national security implications, with significant investments often made in maintenance and sustainment of complex platforms.

Small Business Impact

There is no indication that small businesses were involved in this contract, as it was awarded directly to Lockheed Martin Corporation. Future contracts of this nature should explore opportunities for small business subcontracting to foster broader economic participation.

Oversight & Accountability

The Department of Defense, through its contracting agencies, is responsible for overseeing this contract. Robust oversight is crucial to ensure performance, manage costs, and verify the necessity of sole-source awards.

Related Government Programs

Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Lack of competition
Potential for cost overruns
Long contract duration
Critical system dependency
Limited small business participation

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $148.4 million to LOCKHEED MARTIN CORPORATION. 200006!1700!00A037!XSP01 !STRATEGIC SYSTEMS PROGRAMS !N0003000C0009 !A!*!* !19991216!20010315!075796037!834951691!834951691!N!80070!LOCKHEED MARTIN CORPORATION !55 CHARLES LINDBERG BLVD !GREAT NECK !NY!11020!30169!059!36!GREAT NECK !NASSAU !NEW YORK !0001!+000008581000!Y!N!000000000000!J019!MAINT & REPAIR OF EQ/SHIPS-SML CRAFT-DOCKS !A2 !MISSILE AND SPACE SYSTEMS !2CNJ!UGM-96 TRIDENT !3812!3!*!*!*!B!A!*!D !N!L!

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 $148.4 million.

What is the period of performance?

Start: 1999-12-16. End: 2006-12-22.

What is the justification for the sole-source award, and has an alternatives analysis been conducted?

The justification for a sole-source award typically stems from the unique capabilities or proprietary knowledge required to service specific defense systems, such as the UGM-96 Trident. An alternatives analysis would assess whether other contractors could perform the work, even if less efficiently, to ensure the government is obtaining the best value and that competition is only forgone when truly necessary.

How does the fixed-price incentive structure mitigate cost overruns for this complex maintenance contract?

A fixed-price incentive (FPI) contract establishes a target cost, target profit, and a price ceiling. If the final cost is below the target, both the contractor and the government share in the savings. If costs exceed the target but remain below the ceiling, the contractor's profit is reduced. This structure incentivizes the contractor to control costs while providing a ceiling to protect the government from unlimited cost increases.

What performance metrics are being used to evaluate Lockheed Martin's maintenance and repair services for the UGM-96 Trident?

Effective oversight requires clearly defined performance metrics. For this contract, metrics likely include system availability rates, turnaround times for repairs, quality of work (e.g., defect rates), and adherence to maintenance schedules. These metrics should be regularly reviewed by the contracting officer's representative to ensure the contractor is meeting contractual obligations and maintaining the readiness of critical assets.

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: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIXED PRICE INCENTIVE (L)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 55 CHARLES LINDBERG BLVD, GREAT NECK, NY, 11020

Business Categories: Category Business, Not Designated a Small Business

Financial Breakdown

Contract Ceiling: $145,676,815

Exercised Options: $145,676,815

Current Obligation: $148,353,815

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline