DoD Awards $59.7M Javelin Missile Contract to Raytheon/Lockheed Martin JV

Contract Overview

Contract Amount: $59,752,606 ($59.8M)

Contractor: Raytheon/Lockheed Martin Javelin JV

Awarding Agency: Department of Defense

Start Date: 2016-08-31

End Date: 2019-04-30

Contract Duration: 972 days

Daily Burn Rate: $61.5K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: IGF::CL,CT::IGF CONTRACT AWARD INDUSTRIAL BASE, INFRASTRUCTURE, SERVICE AND REPAIRS FOR THE COMMAND UNIT LAUNCHER

Place of Performance

Location: LOS ANGELES, LOS ANGELES County, CALIFORNIA, 90045

State: California Government Spending

Plain-Language Summary

Department of Defense obligated $59.8 million to RAYTHEON/LOCKHEED MARTIN JAVELIN JV for work described as: IGF::CL,CT::IGF CONTRACT AWARD INDUSTRIAL BASE, INFRASTRUCTURE, SERVICE AND REPAIRS FOR THE COMMAND UNIT LAUNCHER Key points: 1. Significant award to a joint venture of major defense contractors. 2. Focus on guided missile manufacturing indicates a critical defense capability. 3. Contract duration of 972 days suggests a substantial, ongoing need. 4. No small business participation noted, potentially limiting broader economic impact.

Value Assessment

Rating: fair

The contract value of $59.7M for guided missile manufacturing appears within a reasonable range for specialized defense equipment. Benchmarking against similar sole-source or limited-competition contracts for advanced missile systems would provide a more precise assessment.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was not competed, indicating a sole-source or limited-source award. This approach may be justified for specialized defense systems where only a few entities possess the required technology or manufacturing capability. However, it limits price discovery and potentially increases costs for taxpayers.

Taxpayer Impact: The lack of competition in this sole-source award means taxpayers may not be receiving the best possible price for these critical missile systems.

Public Impact

Ensures continued availability of essential guided missile technology for the military. Supports high-tech manufacturing jobs within the defense industrial base. Potential for future contract modifications or follow-on awards.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competition and price negotiation.
No small business participation.

Positive Signals

Addresses critical defense need for guided missiles.
Award to established prime contractors with proven capabilities.

Sector Analysis

This contract falls within the Guided Missile and Space Vehicle Manufacturing sector, a highly specialized and capital-intensive area of the defense industrial base. Spending in this sector is driven by national security requirements and technological advancements.

Small Business Impact

The contract data indicates no small business participation. This is common for large, complex defense manufacturing contracts awarded to prime contractors like Raytheon and Lockheed Martin, who often utilize their own extensive supply chains.

Oversight & Accountability

As a sole-source award, this contract warrants close oversight to ensure fair pricing and adherence to contract terms. The Department of Defense's contracting officers are responsible for validating the necessity of the sole-source justification and monitoring performance.

Related Government Programs

Guided Missile and Space Vehicle Manufacturing
Department of Defense Contracting
Department of the Army Programs

Risk Flags

Sole-source award limits competition.
Potential for cost overruns due to lack of competitive pressure.
Reliance on a single joint venture for a critical defense system.
No small business involvement.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $59.8 million to RAYTHEON/LOCKHEED MARTIN JAVELIN JV. IGF::CL,CT::IGF CONTRACT AWARD INDUSTRIAL BASE, INFRASTRUCTURE, SERVICE AND REPAIRS FOR THE COMMAND UNIT LAUNCHER

Who is the contractor on this award?

The obligated recipient is RAYTHEON/LOCKHEED MARTIN JAVELIN JV.

Which agency awarded this contract?

Awarding agency: Department of Defense (Department of the Army).

What is the total obligated amount?

The obligated amount is $59.8 million.

What is the period of performance?

Start: 2016-08-31. End: 2019-04-30.

What is the specific justification for the sole-source award of this Javelin missile contract, and how was the price determined to be fair and reasonable?

The justification for a sole-source award typically stems from the unique capabilities or proprietary technology held by a single contractor or a specific joint venture, as is likely the case with the Javelin system. Price reasonableness is usually determined through methods like comparison to previous contracts, cost analysis, or market research, though the absence of competition inherently limits the robustness of this determination.

What are the long-term strategic implications of awarding such a significant contract to a single joint venture for a critical defense asset like the Javelin missile?

Awarding a significant contract to a single joint venture can ensure focused development and production of a critical defense asset, potentially leading to greater efficiency and technological advancement within that specific system. However, it also concentrates risk and reliance on that entity, potentially impacting long-term competition and innovation across the broader missile manufacturing sector.

How does this contract contribute to the overall readiness and modernization goals of the Department of the Army, and what are the potential risks if production or delivery is disrupted?

This contract directly supports the Army's readiness by ensuring a steady supply of Javelin missiles, a key anti-tank weapon system. Modernization goals are met by procuring advanced versions or maintaining sufficient inventory. Risks of disruption are significant, potentially impacting combat effectiveness and requiring urgent, possibly more expensive, alternative sourcing or expedited production.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Guided Missile and Space Vehicle Manufacturing

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: W31P4Q14R0187

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1151 E HERMANS RD BLDG 805 M\S C6, TUCSON, AZ, 85756

Business Categories: Category Business, Manufacturer of Goods, Not Designated a Small Business, Partnership or Limited Liability Partnership, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $75,818,429

Exercised Options: $59,752,606

Current Obligation: $59,752,606

Actual Outlays: $1,488

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $44,157

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Timeline