DoD Awards $3.9B R&D Contract to Lockheed Martin for IR CPS WS Development
Contract Overview
Contract Amount: $3,924,682,460 ($3.9B)
Contractor: Lockheed Martin Corp
Awarding Agency: Department of Defense
Start Date: 2018-12-20
End Date: 2026-05-31
Contract Duration: 2,719 days
Daily Burn Rate: $1.4M/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: R&D
Official Description: IR CPS WS DEVELOPMENT AND INTEGRATION
Place of Performance
Location: LITTLETON, DOUGLAS County, COLORADO, 80125
State: Colorado Government Spending
Plain-Language Summary
Department of Defense obligated $3.92 billion to LOCKHEED MARTIN CORP for work described as: IR CPS WS DEVELOPMENT AND INTEGRATION Key points: 1. Significant investment in advanced technology development by the Department of the Navy. 2. Sole-source award to a major defense contractor raises questions about competition and price discovery. 3. Long contract duration (2018-2026) suggests a complex, multi-year development effort. 4. High dollar value indicates a critical program with substantial resource allocation.
Value Assessment
Rating: questionable
The contract's cost-plus-fixed-fee structure for R&D can lead to cost overruns. Without competitive benchmarking, assessing the value for money is difficult, especially given the large award amount.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Lockheed Martin. This limits price discovery and potentially increases costs for taxpayers compared to a competitive process.
Taxpayer Impact: The lack of competition for a nearly $4 billion contract means taxpayers may not be receiving the best possible price or value.
Public Impact
Potential for advanced technological advancements in defense capabilities. Taxpayer funds are being directed towards a single, large defense contractor. The long-term nature of the contract impacts budget planning and resource allocation for future defense needs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Long contract duration
- High dollar value
Positive Signals
- Award to established defense contractor
- Focus on R&D for critical systems
Sector Analysis
This contract falls under the Research and Development in the Physical, Engineering, and Life Sciences category. Spending in this sector is crucial for technological advancement but requires careful oversight due to its inherent complexity and long development cycles.
Small Business Impact
This contract was awarded to Lockheed Martin, a large prime contractor, and there is no indication of subcontracting opportunities for small businesses within the provided data.
Oversight & Accountability
The sole-source nature of this large contract warrants close oversight from the Department of Defense to ensure cost control, adherence to scope, and effective program management throughout its duration.
Related Government Programs
- Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Lack of competition
- Potential for cost overruns
- Limited transparency in pricing
- Long-term commitment of significant funds
- Contract type (Cost Plus Fixed Fee)
Tags
research-and-development-in-the-physical, department-of-defense, co, definitive-contract, billion-dollar
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $3.92 billion to LOCKHEED MARTIN CORP. IR CPS WS DEVELOPMENT AND INTEGRATION
Who is the contractor on this award?
The obligated recipient is LOCKHEED MARTIN CORP.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $3.92 billion.
What is the period of performance?
Start: 2018-12-20. End: 2026-05-31.
What specific justifications were provided for awarding this contract on a sole-source basis, and were alternative competitive strategies considered?
Sole-source awards are typically justified when only one responsible source can provide the required supplies or services. For a contract of this magnitude and duration, the Department of Defense would need to provide robust documentation supporting the lack of competition, such as unique capabilities, proprietary technology, or urgent national security needs that preclude a competitive process.
How will the cost-plus-fixed-fee structure be managed to prevent cost overruns and ensure fair pricing for the government?
Effective management of a cost-plus-fixed-fee contract involves rigorous cost monitoring, detailed audits, and clear performance metrics. The government contracting officer must actively oversee expenditures, validate costs, and ensure that the contractor is operating efficiently to achieve the fixed fee without excessive cost escalation.
What are the key performance indicators (KPIs) for this R&D effort, and how will their achievement be measured to assess program effectiveness?
Program effectiveness will be measured against predefined KPIs related to technological milestones, system performance, integration capabilities, and adherence to development schedules. Regular technical reviews and independent assessments will be crucial to track progress and ensure the R&D effort is meeting its objectives and delivering the intended capabilities.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Scientific Research and Development Services › Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology)
Product/Service Code: RESEARCH AND DEVELOPMENT › C – National Defense R&D Services
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0003019R0025
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 12257 S WADSWORTH BLVD, LITTLETON, CO, 80125
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $4,297,956,081
Exercised Options: $4,261,956,081
Current Obligation: $3,924,682,460
Actual Outlays: $234,602,794
Subaward Activity
Number of Subawards: 1478
Total Subaward Amount: $2,368,835,362
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2018-12-20
Current End Date: 2026-05-31
Potential End Date: 2026-05-31 00:00:00
Last Modified: 2025-12-19
More Contracts from Lockheed Martin Corp
- Federal Contract — $48.1B (Department of Energy)
- TAS::80 0124::TAS Design, Development, Test&evaluation of Project Orion — $15.5B (National Aeronautics and Space Administration)
- 200207!000021!5700!CZ62 !smc/Pkj LOS Angeles AFB !F0470102C0002 !A!N! !N! !20011116!20070630!872978978!196596688!834951691!n!lockheed Martin Corporation !1111 Lockheed Martin WAY !sunnyvale !ca!94089!77000!085!06!sunnyvale !santa Clara !california!+000012250000!n!n!000000000000!ar92!rdte/Space - Other - Applied Research !A2 !missile and Space Systems !3gfk!milstar !541710!E! !1! ! ! ! ! !99990909!B! ! !B! !d!n!j!2!001!n!2a!z!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! ! ! ! !0001! — $9.0B (Department of Defense)
- Next Generation Overhead Persistent Infrared Geosynchronous Earth Orbit Space Vehicle 1-3 Phase 1 — $7.3B (Department of Defense)
- Federal Contract — $7.3B (Department of Defense)
Other Department of Defense Contracts
- Federal Contract — $51.3B (Humana Government Business Inc)
- Lrip LOT 12 Advance Acquisition Contract — $35.1B (Lockheed Martin Corporation)
- SSN 802 and 803 Long Lead Time Material — $34.7B (Electric Boat Corporation)
- 200204!008532!1700!AF600 !naval AIR Systems Command !N0001902C3002 !A!N! !N! !20011026!20120430!008016958!008016958!834951691!n!lockheed Martin Corporation !lockheed Blvd !fort Worth !tx!76108!27000!439!48!fort Worth !tarrant !texas !+000026000000!n!n!018981928201!ac15!rdte/Aircraft-Eng/Manuf Develop !a1a!airframes and Spares !2ama!jast/Jsf !336411!E! !3! ! ! ! ! !99990909!B! ! !A! !a!n!r!2!002!n!1a!a!n!z! ! !N!C!N! ! ! !a!a!a!a!000!a!c!n! ! ! !Y! !N00019!0001! — $34.2B (Lockheed Martin Corporation)
- KC-X Modernization Program — $32.0B (THE Boeing Company)