DoD awards $20M sole-source contract for F/A-18 Infrared Search and Track system components

Contract Overview

Contract Amount: $20,019,391 ($20.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2020-09-21

End Date: 2025-10-31

Contract Duration: 1,866 days

Daily Burn Rate: $10.7K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 5 INFRARED RECEIVERS AND 4 CONTROL PROCESSORS IN SUPPORT OF THE F/A-18 BLOCK II INFRARED SEARCH AND TRACK SYSTEM (IRST)

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $20.0 million to LOCKHEED MARTIN CORPORATION for work described as: 5 INFRARED RECEIVERS AND 4 CONTROL PROCESSORS IN SUPPORT OF THE F/A-18 BLOCK II INFRARED SEARCH AND TRACK SYSTEM (IRST) Key points: 1. Contract awarded on a sole-source basis, raising questions about price competition. 2. The contract supports critical components for the F/A-18 Block II Infrared Search and Track system. 3. Long performance period of over 5 years suggests a need for sustained support. 4. The awardee, Lockheed Martin Corporation, is a major defense contractor with extensive experience. 5. Geographic location of performance is Florida, a hub for aerospace and defense activities. 6. The contract type is Firm Fixed Price, which shifts cost risk to the contractor.

Value Assessment

Rating: fair

The contract value of $20,019,391 for 5 infrared receivers and 4 control processors appears to be within a reasonable range for specialized defense components, though a direct comparison is difficult without more detailed specifications. The firm fixed-price structure suggests the government has negotiated a ceiling price. However, the lack of competition makes a robust value-for-money assessment challenging, as there is no benchmark from competing bids. Further analysis would require understanding the specific technical requirements and the contractor's cost structure.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning it was not competed among multiple vendors. This typically occurs when a specific contractor possesses unique capabilities, proprietary technology, or is the only source capable of meeting the requirement. The lack of competition limits the government's ability to leverage market forces to achieve the lowest possible price and may indicate a reliance on a single supplier for these critical components.

Taxpayer Impact: Taxpayers may not benefit from the potential cost savings that could arise from a competitive bidding process. The absence of competition can lead to higher prices than might be achieved in an open market.

Public Impact

The primary beneficiaries are the U.S. Navy pilots and aircrews who rely on the F/A-18 aircraft for tactical advantage. The contract delivers essential components for the Infrared Search and Track (IRST) system, enhancing the aircraft's situational awareness and targeting capabilities. The geographic impact is concentrated in Florida, where the performance and likely integration activities will take place. This contract supports specialized roles within the aerospace and defense manufacturing sector, potentially involving skilled technicians and engineers.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits price discovery and potential cost savings for taxpayers.
Long-term contract duration could lock in pricing without periodic re-evaluation.
Reliance on a single supplier for critical components poses a supply chain risk.

Positive Signals

Firm Fixed Price contract shifts cost overrun risk to the contractor.
Awardee is a well-established defense contractor with a proven track record.
Components are for a critical system (IRST) on a key military platform (F/A-18).

Sector Analysis

This contract falls within the aerospace and defense manufacturing sector, specifically focusing on aircraft parts and auxiliary equipment. The market for such specialized components is often characterized by high barriers to entry due to technological complexity and stringent quality requirements. Spending in this area is driven by military modernization programs and the sustainment of existing fleets. Comparable spending benchmarks would typically involve other sole-source or limited-competition awards for similar advanced avionics or sensor systems.

Small Business Impact

This contract does not appear to involve a small business set-aside, as the awardee is Lockheed Martin Corporation, a large prime contractor. There is no explicit information regarding subcontracting plans for small businesses within this specific delivery order. The impact on the small business ecosystem is likely indirect, potentially through Lockheed Martin's broader subcontracting network, but not directly driven by this award's structure.

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 Firm Fixed Price contract type, which obligates the contractor to deliver specified goods within the agreed price. Transparency is limited due to the sole-source nature of the award, but contract details are typically available through federal procurement databases. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

F/A-18 Super Hornet Program
Naval Aviation Systems
Defense Avionics and Sensors
Infrared Search and Track Systems
Aerospace Manufacturing

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Supply chain dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $20.0 million to LOCKHEED MARTIN CORPORATION. 5 INFRARED RECEIVERS AND 4 CONTROL PROCESSORS IN SUPPORT OF THE F/A-18 BLOCK II INFRARED SEARCH AND TRACK SYSTEM (IRST)

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 $20.0 million.

What is the period of performance?

Start: 2020-09-21. End: 2025-10-31.

What is Lockheed Martin Corporation's track record with the F/A-18 IRST system and similar defense contracts?

Lockheed Martin Corporation, as a major defense contractor, has a long-standing relationship with the Department of Defense and has been involved in various aspects of the F/A-18 program, including the development and sustainment of its systems. Their track record with IRST systems and similar advanced sensor technologies is extensive, often involving complex integration and manufacturing processes. They have a history of performing on large, sole-source contracts for critical defense platforms. While specific performance metrics for this exact contract are not publicly detailed, their overall performance on similar programs is generally characterized by meeting technical specifications, albeit sometimes with cost and schedule challenges common in the defense industry. Their experience provides a degree of confidence in their ability to deliver the required components.

How does the $20 million award compare to historical spending on F/A-18 IRST components?

Direct historical spending comparisons for these specific components (5 infrared receivers and 4 control processors) are challenging without more granular data. The $20 million award represents a significant investment for a specific set of parts. However, the F/A-18 program has been in service for many years, and cumulative spending on IRST systems, including development, upgrades, and sustainment, would likely be much higher. This $20 million delivery order appears to be for a specific procurement phase, possibly for a particular block upgrade or sustainment effort. Without knowing the quantity of aircraft these components are intended for, or if this includes spares, a precise historical benchmark is difficult to establish. It is plausible that similar sole-source procurements for advanced avionics components could range in the tens of millions.

What are the primary risks associated with this sole-source contract for the F/A-18 IRST system?

The primary risk associated with this sole-source contract is the lack of price competition, which could lead to the government paying a higher price than if the contract were competed. This increases the financial risk for taxpayers. Another risk is the potential for supply chain disruptions, as the government is reliant on a single supplier, Lockheed Martin, for these critical components. If Lockheed Martin faces production issues or delays, it could impact the readiness of the F/A-18 fleet. Furthermore, the long contract duration (over 5 years) means that the government is committed to this supplier for an extended period, potentially missing out on innovations or cost reductions from other potential suppliers that might emerge over time.

How effective is the F/A-18 Block II IRST system, and what is the impact of these components on its effectiveness?

The F/A-18 Block II Infrared Search and Track (IRST) system is a crucial passive sensor that detects and tracks airborne threats using infrared signatures, complementing the aircraft's radar. Its effectiveness lies in its ability to provide situational awareness without emitting signals, making it harder for adversaries to detect the F/A-18. The infrared receivers and control processors are fundamental components that enable the system to acquire, process, and display infrared data. The quality and reliability of these specific components directly influence the IRST system's sensitivity, accuracy, tracking range, and overall performance in identifying and prioritizing targets. Ensuring the availability of these high-quality components is vital for maintaining the combat effectiveness of the F/A-18 fleet.

What is the typical competition level for advanced aircraft components like IRST systems, and why was this contract sole-sourced?

Advanced aircraft components, especially those involving proprietary technology or requiring deep integration with existing platforms, often face limited competition. The F/A-18 IRST system likely incorporates specialized technology developed or refined by Lockheed Martin, making it difficult for other companies to offer a comparable or compliant solution without significant investment or licensing. Sole-source awards for such systems are typically justified by factors such as unique capabilities, essential system integration, or the need to maintain commonality with existing fielded systems. The Department of Defense would have likely conducted a Justification and Approval (J&A) process to document why full and open competition was not feasible or not in the government's best interest for this specific procurement.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing

Product/Service Code: COMM/DETECT/COHERENT RADIATION

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: N0038320RN229

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1801 STATE RT 17 C, OWEGO, NY, 13827

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: $20,019,391

Exercised Options: $20,019,391

Current Obligation: $20,019,391

Subaward Activity

Number of Subawards: 50

Total Subaward Amount: $21,799,664

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: N0001919G0029

IDV Type: BOA

Timeline