DoD awards $685M for Sentinel A4 Radar development, a significant investment in cruise missile defense
Contract Overview
Contract Amount: $684,666,325 ($684.7M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2019-09-25
End Date: 2027-09-13
Contract Duration: 2,910 days
Daily Burn Rate: $235.3K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIXED PRICE INCENTIVE
Sector: R&D
Official Description: CRUISE MISSILE DEFENSE SYSTEMS SENTINEL A4 RADAR DEVELOPMENT COMPETITIVE REQUIREMENT
Place of Performance
Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088
State: New York Government Spending
Plain-Language Summary
Department of Defense obligated $684.7 million to LOCKHEED MARTIN CORPORATION for work described as: CRUISE MISSILE DEFENSE SYSTEMS SENTINEL A4 RADAR DEVELOPMENT COMPETITIVE REQUIREMENT Key points: 1. This contract represents a substantial commitment to advancing critical defense capabilities. 2. The fixed-price incentive structure aims to balance cost control with performance incentives. 3. Competition dynamics are crucial for ensuring technological advancement and cost-effectiveness in this specialized sector. 4. The long duration suggests a complex, multi-phase development process. 5. Performance context will be key to evaluating the ultimate value and effectiveness of the radar system. 6. Sector positioning highlights the growing importance of advanced radar technology in modern warfare.
Value Assessment
Rating: good
The contract value of $684.7 million for the Sentinel A4 Radar development is substantial, reflecting the complexity and strategic importance of the system. Benchmarking this against similar advanced radar development programs is challenging due to the specialized nature of cruise missile defense. However, the fixed-price incentive (FPI) contract type suggests an effort to manage costs while incentivizing contractor performance. The pricing will need to be closely monitored against development milestones and technological advancements to ensure value for money.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under full and open competition, indicating that multiple capable vendors were invited to bid. The presence of two bidders, Lockheed Martin Corporation being the awardee, suggests a competitive environment for this advanced technology. A competitive process is generally expected to drive innovation and potentially lead to more favorable pricing for the government.
Taxpayer Impact: Full and open competition is beneficial for taxpayers as it increases the likelihood of receiving the best possible technology and pricing through a rigorous evaluation process.
Public Impact
The primary beneficiaries are the U.S. Army and the Department of Defense, enhancing national security through improved missile defense capabilities. The service delivered is the development of the Sentinel A4 Radar system, a critical component for detecting and tracking cruise missiles. The contract is associated with New York (st), suggesting potential workforce and economic impacts in that region. This development effort will likely involve highly skilled engineers, scientists, and technicians, contributing to the specialized defense technology workforce.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns inherent in fixed-price incentive contracts if development challenges arise.
- Long contract duration increases exposure to evolving technological requirements and market shifts.
- Dependence on a single contractor for a critical defense system raises long-term sustainment and upgrade concerns.
Positive Signals
- Awarded through full and open competition, ensuring a broad search for the best solution.
- Fixed-price incentive structure aligns contractor and government interests towards successful development and cost management.
- Development of advanced radar technology contributes to a critical national security capability.
Sector Analysis
The contract falls within the Research and Development (R&D) sector, specifically focusing on advanced radar systems for defense applications. The market for sophisticated defense electronics, including radar and electronic warfare systems, is highly specialized and dominated by a few large prime contractors. Spending in this area is driven by evolving geopolitical threats and the need for technological superiority. Comparable spending benchmarks would likely be found within other major defense acquisition programs for advanced sensor technologies.
Small Business Impact
This contract does not appear to have a specific small business set-aside. Given the highly specialized and advanced nature of radar development, prime contractors like Lockheed Martin typically handle the core technology development. Subcontracting opportunities may exist for specialized components or services, but the primary award is to a large business. The overall impact on the small business ecosystem for this specific contract is likely indirect, through potential lower-tier subcontracting.
Oversight & Accountability
Oversight will be provided by the Department of the Army, likely through program management offices and contracting officers. The contract's fixed-price incentive nature necessitates close monitoring of performance milestones and cost expenditures. Transparency will be maintained through regular reporting requirements and potential audits. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.
Related Government Programs
- Missile Defense Systems
- Advanced Radar Technology
- Department of Defense Research and Development
- Army Aviation and Missile Command
- Cruise Missile Defense Initiatives
Risk Flags
- Long-term development timeline increases risk of obsolescence or changing requirements.
- Complexity of advanced radar technology presents inherent technical challenges.
- Reliance on a single awardee for critical capability requires robust oversight.
Tags
defense, department-of-defense, department-of-the-army, research-and-development, radar-systems, cruise-missile-defense, fixed-price-incentive, full-and-open-competition, lockheed-martin-corporation, new-york, major-contract, national-security
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $684.7 million to LOCKHEED MARTIN CORPORATION. CRUISE MISSILE DEFENSE SYSTEMS SENTINEL A4 RADAR DEVELOPMENT COMPETITIVE REQUIREMENT
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 $684.7 million.
What is the period of performance?
Start: 2019-09-25. End: 2027-09-13.
What is Lockheed Martin Corporation's track record with similar advanced radar development contracts for the Department of Defense?
Lockheed Martin Corporation has a long and extensive history of developing and producing advanced radar systems for various U.S. military branches, including the Army, Navy, and Air Force. They have been involved in programs ranging from fighter jet radar (e.g., APG-81 for the F-35) to large-scale surveillance and missile defense radars. Their experience includes developing complex sensor technologies, integrating them into weapon systems, and managing large-scale, multi-year development contracts. This background suggests a strong capability to undertake the Sentinel A4 Radar development, although the specific challenges and success metrics of this particular program will be unique.
How does the pricing structure (Fixed Price Incentive) compare to other radar development contracts, and what are the potential value implications?
Fixed Price Incentive (FPI) contracts are common for development programs where the government wants to share some of the risk and reward with the contractor. Unlike Firm Fixed Price (FFP), FPI allows for price adjustments based on achieving target costs and performance outcomes. This structure incentivizes the contractor to control costs and meet performance specifications, as they can earn a higher profit if they outperform targets, but also face profit limitations if costs exceed targets. Compared to FFP, FPI offers more flexibility for complex R&D where cost certainty is difficult. For taxpayers, the value implication is that it aims for a balance: encouraging innovation and efficiency while providing a ceiling on potential cost overruns, though close oversight is still required to ensure the target costs are reasonable and achievable.
What are the primary technical risks associated with developing the Sentinel A4 Radar system, and how are they being mitigated?
Key technical risks in developing advanced radar systems like the Sentinel A4 often include achieving required detection ranges and accuracy against sophisticated threats (like low-observable cruise missiles), ensuring system reliability and maintainability in harsh operational environments, and integrating the radar with command and control systems. Mitigation strategies typically involve phased development with rigorous testing at each stage, employing advanced modeling and simulation, utilizing mature technologies where possible, and building in redundancy. The FPI contract structure itself incentivizes the contractor to proactively identify and mitigate these risks to achieve target cost and performance objectives.
What is the historical spending pattern for cruise missile defense radar development within the Department of the Army?
Historical spending on cruise missile defense radar development within the Department of the Army has been significant and generally increasing, reflecting the growing threat posed by advanced cruise missiles. Major programs have included upgrades to existing systems and the development of new capabilities. While specific figures for 'Sentinel A4 Radar development' prior to this award are not detailed here, the overall budget allocation for air and missile defense systems, which includes radar components, has been a consistent priority. This contract represents a substantial, focused investment in a critical sub-category of this broader defense spending area.
How will the success of the Sentinel A4 Radar development program be measured, and what are the key performance indicators (KPIs)?
The success of the Sentinel A4 Radar development program will be measured against specific technical performance specifications outlined in the contract. Key Performance Indicators (KPIs) will likely include metrics related to detection range, accuracy (e.g., target classification, track fidelity), reliability (Mean Time Between Failures - MTBF), system availability, and the ability to operate effectively in various electronic warfare environments. The FPI contract structure means that achieving these KPIs within or below target cost parameters will be critical for determining the contractor's ultimate profit and the overall value realized by the government.
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: HARDWARE AND ABRASIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: W31P4Q18R0043
Offers Received: 2
Pricing Type: FIXED PRICE INCENTIVE (L)
Evaluated Preference: NONE
Contractor Details
Address: 497 ELECTRONICS PKWY BLDG 5, LIVERPOOL, NY, 13088
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: $693,433,285
Exercised Options: $684,666,325
Current Obligation: $684,666,325
Subaward Activity
Number of Subawards: 926
Total Subaward Amount: $302,494,315
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NO
Timeline
Start Date: 2019-09-25
Current End Date: 2027-09-13
Potential End Date: 2027-09-13 12:09:00
Last Modified: 2026-01-21
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