DoD Awards $1.11 Billion for PAC-3 Missile Support to Lockheed Martin
Contract Overview
Contract Amount: $11,086,888 ($11.1M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2024-05-29
End Date: 2027-12-22
Contract Duration: 1,302 days
Daily Burn Rate: $8.5K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITY-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE US AND FOREIGN MILITARY SALES (FMS) CUSTOMERS.
Place of Performance
Location: GRAND PRAIRIE, DALLAS County, TEXAS, 75051
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $11.1 million to LOCKHEED MARTIN CORPORATION for work described as: THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITY-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE US AND FOREIGN MILITARY SALES (FMS) CUSTOMERS. Key points: 1. This contract focuses on critical support for the PAC-3 missile system, vital for national defense. 2. The sole-source nature raises questions about price discovery and potential cost efficiencies. 3. High value indicates significant reliance on this specific missile defense capability. 4. The defense sector is characterized by long-term, high-value contracts for specialized equipment.
Value Assessment
Rating: questionable
The contract is Cost Plus Fixed Fee, which can lead to higher costs compared to fixed-price contracts. Without competitive bidding, it's difficult to assess if the pricing is optimal.
Cost Per Unit: N/A
Competition Analysis
Competition Level: sole-source
This contract was not competed, indicating a sole-source award to Lockheed Martin. This limits price discovery and may result in higher costs for taxpayers.
Taxpayer Impact: The lack of competition for a contract of this magnitude could lead to inflated prices, impacting taxpayer funds.
Public Impact
Ensures continued operational readiness of the PAC-3 missile defense system. Supports both U.S. military needs and foreign military sales, impacting international security relationships. Sustains critical defense manufacturing capabilities and associated jobs.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of transparency in pricing
Positive Signals
- Essential defense capability
- Long-term support contract
Sector Analysis
This contract falls within the defense sector, specifically missile manufacturing and support. Spending in this area is typically high due to the specialized nature and critical importance of defense systems.
Small Business Impact
The data indicates this contract was not awarded to small businesses, as Lockheed Martin is a large corporation. There is no indication of subcontracting opportunities for small businesses within this award.
Oversight & Accountability
The sole-source nature of this contract warrants close oversight to ensure costs are reasonable and performance meets requirements. Transparency in reporting is crucial for accountability.
Related Government Programs
- Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Sole-source award limits competition.
- Cost-plus contract type may lead to higher costs.
- Potential for price escalation over contract duration.
- Dependency on a single contractor for critical defense asset support.
Tags
other-guided-missile-and-space-vehicle-p, department-of-defense, tx, delivery-order, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $11.1 million to LOCKHEED MARTIN CORPORATION. THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITY-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE US AND FOREIGN MILITARY SALES (FMS) CUSTOMERS.
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 $11.1 million.
What is the period of performance?
Start: 2024-05-29. End: 2027-12-22.
What is the projected total cost for the PAC-3 missile support over the contract's duration, and how does this compare to historical spending on similar support services?
The current award is valued at $1.11 billion, with an estimated completion date in late 2027. A detailed analysis of historical spending on PAC-3 support and comparable missile system maintenance would be necessary to determine if this figure represents value for money. The cost-plus fixed fee structure necessitates careful monitoring to prevent cost overruns.
What specific risks are associated with relying solely on Lockheed Martin for PAC-3 missile support, and what mitigation strategies are in place?
The primary risk is the lack of competitive pressure, potentially leading to higher prices and reduced innovation. Dependency on a single supplier can also create vulnerabilities in the supply chain. Mitigation strategies might include robust contract management, performance incentives, and exploring alternative support options in the future, though these are not evident in a sole-source award.
How effectively does this contract ensure the long-term readiness and technological advancement of the PAC-3 missile system for U.S. and allied forces?
The contract's duration and focus on support suggest a commitment to maintaining current readiness. However, the lack of competition might limit incentives for proactive technological upgrades or cost-effective modernization. The effectiveness hinges on Lockheed Martin's internal R&D and the DoD's ability to negotiate future enhancements within this framework.
Industry Classification
NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Other Guided Missile and Space Vehicle Parts and Auxiliary Equipment Manufacturing
Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT
Competition & Pricing
Extent Competed: NOT COMPETED
Solicitation Procedures: ONLY ONE SOURCE
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: Lockheed Martin Corp
Address: 1701 W MARSHALL DR, GRAND PRAIRIE, TX, 75051
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: $11,086,888
Exercised Options: $11,086,888
Current Obligation: $11,086,888
Subaward Activity
Number of Subawards: 3
Total Subaward Amount: $420,194
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: YES
Parent Contract
Parent Award PIID: W31P4Q22D0022
IDV Type: IDC
Timeline
Start Date: 2024-05-29
Current End Date: 2027-12-22
Potential End Date: 2027-12-22 12:12:00
Last Modified: 2025-11-25
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