DoD awards $35M+ to Lockheed Martin for aircraft parts, raising concerns over sole-source procurement
Contract Overview
Contract Amount: $35,094,242 ($35.1M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2004-06-30
End Date: 2017-09-30
Contract Duration: 4,840 days
Daily Burn Rate: $7.3K/day
Competition Type: NOT COMPETED
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Place of Performance
Location: GRAND PRAIRIE, DALLAS County, TEXAS, 75051
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $35.1 million to LOCKHEED MARTIN CORPORATION for work described as: Key points: 1. Significant contract value awarded to a single large corporation. 2. Lack of competition suggests potential for inflated pricing. 3. Long contract duration (over 10 years) warrants scrutiny. 4. Sector: Defense - Other Aircraft Parts and Auxiliary Equipment Manufacturing.
Value Assessment
Rating: questionable
The contract value of $35M+ over 13 years is substantial. Without competitive bidding, it's difficult to assess if this represents fair market value compared to similar aircraft parts contracts.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award. This significantly limits price discovery and potentially leads to higher costs for taxpayers.
Taxpayer Impact: The lack of competition means taxpayers may be overpaying for these aircraft parts due to the absence of market forces driving down prices.
Public Impact
Taxpayers may be paying a premium for aircraft parts due to a lack of competitive bidding. Long-term contract could lock in potentially inefficient pricing structures. Limited transparency into the justification for sole-source award. Potential for reduced innovation if only one supplier is engaged.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source procurement
- Long contract duration
- Lack of transparency on justification
- No small business participation
Positive Signals
- Established supplier for critical defense components
Sector Analysis
This contract falls within the Defense sector, specifically manufacturing aircraft parts. Spending in this area is critical for national security, but competitive sourcing is vital to ensure cost-effectiveness.
Small Business Impact
The data indicates no small business participation in this contract, which is common in large sole-source defense awards. This misses opportunities to support smaller businesses.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure the pricing is justified and that the government is receiving good value. A review of the justification for non-competition is crucial.
Related Government Programs
- Other Aircraft Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award lacks competition, potentially increasing costs.
- Long contract duration (over 10 years) may not reflect current market conditions.
- No indication of small business involvement.
- Potential for price creep over the contract's life.
- Transparency regarding the justification for non-competition is limited.
Tags
other-aircraft-parts-and-auxiliary-equip, department-of-defense, tx, definitive-contract, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $35.1 million to LOCKHEED MARTIN CORPORATION. See the official description on USAspending.
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 Army).
What is the total obligated amount?
The obligated amount is $35.1 million.
What is the period of performance?
Start: 2004-06-30. End: 2017-09-30.
What was the specific justification for awarding this contract on a sole-source basis, and was it thoroughly vetted?
The justification for sole-source awards typically involves unique capabilities, urgent needs, or lack of viable alternatives. Without access to the specific documentation, it's impossible to confirm the vetting process. However, the absence of competition inherently raises questions about whether alternatives were adequately explored or if market research was insufficient.
How does the cost of these aircraft parts compare to industry benchmarks, given the lack of competitive bidding?
Direct comparison to industry benchmarks is challenging without knowing the specific parts and their technical specifications. However, sole-source contracts generally carry a higher risk of inflated pricing compared to competitively awarded contracts. The government should have conducted a thorough cost analysis to ensure the price was reasonable, but the lack of competition limits the assurance of optimal value.
What measures are in place to ensure the effectiveness and quality of the aircraft parts provided under this long-term, non-competed contract?
Effectiveness and quality are typically ensured through contract clauses, performance metrics, and inspection/acceptance procedures. For a sole-source contract, rigorous government oversight and quality assurance testing are even more critical. The government must actively monitor performance and enforce contract terms to guarantee the parts meet all required specifications and operational standards.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Aircraft Parts and Auxiliary Equipment Manufacturing
Product/Service Code: GUIDED MISSLES
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp (UEI: 834951691)
Address: 1701 W MARSHALL DRIVE, GRAND PRAIRIE, TX, 75051
Business Categories: Category Business, Not Designated a Small Business
Contract Characteristics
Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED
Cost or Pricing Data: YES
Timeline
Start Date: 2004-06-30
Current End Date: 2017-09-30
Potential End Date: 2017-09-30 12:09:00
Last Modified: 2017-03-29
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