DoD Awards $1.31B Lockheed Martin Contract for Advanced Systems (MSPA) with No Competition
Contract Overview
Contract Amount: $13,121,558 ($13.1M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2024-03-01
End Date: 2027-02-28
Contract Duration: 1,094 days
Daily Burn Rate: $12.0K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: ADVANCED SYSTEMS - MSPA
Place of Performance
Location: WASHINGTON NAVY YARD, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20374
Plain-Language Summary
Department of Defense obligated $13.1 million to LOCKHEED MARTIN CORPORATION for work described as: ADVANCED SYSTEMS - MSPA Key points: 1. Significant contract value of $1.31 billion awarded to a single large defense contractor. 2. Lack of competition raises concerns about potential overpricing and limited innovation. 3. The contract is for engineering services, a critical but often complex area for cost assessment. 4. Focus on 'Advanced Systems' suggests a need for specialized expertise, potentially justifying limited competition.
Value Assessment
Rating: questionable
The contract type is Cost Plus Fixed Fee (CPFF), which can lead to cost overruns if not closely monitored. Without competitive benchmarks, assessing the fairness of the fixed fee and overall pricing is challenging.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was awarded on a sole-source basis, indicating no competitive bidding process. This significantly limits price discovery and may result in higher costs for the government compared to a competitive procurement.
Taxpayer Impact: The absence of competition means taxpayers may be paying a premium for these advanced engineering services, as the government lacks leverage to negotiate the lowest possible price.
Public Impact
Taxpayers may be footing a higher bill due to the lack of competitive pressure. The Department of the Navy is relying on a single provider for critical advanced systems engineering. Potential for reduced innovation if alternative solutions are not explored through competition. Long-term implications for defense readiness if costs escalate significantly.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- High contract value
- Lack of transparency in pricing
Positive Signals
- Award to established defense contractor
- Focus on critical advanced systems
Sector Analysis
The defense sector, particularly for advanced systems, often involves complex engineering and specialized knowledge. While high contract values are common, the lack of competition in this $1.31 billion award warrants scrutiny against industry benchmarks for similar sole-source engineering services.
Small Business Impact
This contract was awarded to Lockheed Martin Corporation, a large prime contractor, and there is no indication of small business participation. The sole-source nature further limits opportunities for small businesses to compete for these services.
Oversight & Accountability
The sole-source award requires robust oversight from the Department of Defense to ensure costs are reasonable and performance meets expectations. Clear performance metrics and regular audits are crucial for accountability on this CPFF contract.
Related Government Programs
- Engineering Services
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for inflated costs due to lack of competition.
- Risk of contractor lock-in and reduced future negotiation leverage.
- Dependency on a single supplier for critical advanced systems.
- Challenges in verifying the necessity and uniqueness of the sole-source justification.
- CPFF contract type can incentivize cost growth if not managed tightly.
Tags
engineering-services, department-of-defense, dc, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $13.1 million to LOCKHEED MARTIN CORPORATION. ADVANCED SYSTEMS - MSPA
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 $13.1 million.
What is the period of performance?
Start: 2024-03-01. End: 2027-02-28.
What specific justification was provided for the sole-source award, and were alternative acquisition strategies considered to foster competition?
The justification for a sole-source award typically centers on unique capabilities, proprietary technology, or urgent needs that only one source can fulfill. However, without detailed documentation, it's difficult to assess if alternative strategies, such as phased competitions or market research for potential competitors, were adequately explored to ensure the best value for the government.
How will the Department of Defense ensure cost control and prevent potential overruns under this Cost Plus Fixed Fee contract without competitive pressure?
Effective cost control will rely heavily on stringent government oversight, detailed cost tracking, and rigorous auditing of Lockheed Martin's expenditures. The fixed fee component needs careful negotiation and monitoring to ensure it reflects a fair profit margin for the work performed, rather than incentivizing cost escalation.
What are the key performance indicators (KPIs) for this contract, and how will their achievement be measured to ensure the effectiveness of the advanced systems developed?
Key performance indicators should be clearly defined and measurable, focusing on technical performance, schedule adherence, and system reliability. The government must establish robust testing and validation processes to independently verify that the advanced systems meet all specified requirements and deliver the intended operational capabilities effectively.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services
Product/Service Code: TECHNICAL REPRESENTATIVE SVCS. › TECHNICAL REPRESENTATIVE SERVICES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Solicitation ID: N0003024R2006
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Address: 1102 JOHN GLENN BLVD, TITUSVILLE, FL, 32780
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: $19,455,522
Exercised Options: $13,121,558
Current Obligation: $13,121,558
Subaward Activity
Number of Subawards: 8
Total Subaward Amount: $2,070,909
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2024-03-01
Current End Date: 2027-02-28
Potential End Date: 2027-02-28 00:00:00
Last Modified: 2026-03-10
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