DoD Awards $59.6M for Patriot Missile Support to Lockheed Martin, Lacking Competition
Contract Overview
Contract Amount: $59,586,137 ($59.6M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2024-03-27
End Date: 2027-04-01
Contract Duration: 1,100 days
Daily Burn Rate: $54.2K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: ATRIOT ADVANCED CAPABILITY-3 MISSILE SUPPORT CENTER (P3MSC) LOGISTICS SUPPORT, US LAUNCHER REPAIR & RETURN (R&R), AND FOREIGN MILITARY SALES (FMS) LAUNCHER R&R
Place of Performance
Location: GRAND PRAIRIE, DALLAS County, TEXAS, 75051
State: Texas Government Spending
Plain-Language Summary
Department of Defense obligated $59.6 million to LOCKHEED MARTIN CORPORATION for work described as: ATRIOT ADVANCED CAPABILITY-3 MISSILE SUPPORT CENTER (P3MSC) LOGISTICS SUPPORT, US LAUNCHER REPAIR & RETURN (R&R), AND FOREIGN MILITARY SALES (FMS) LAUNCHER R&R Key points: 1. Significant contract value of $59.6 million for critical missile support. 2. Sole-source award to Lockheed Martin raises concerns about competitive pricing. 3. Potential for higher costs due to lack of market competition. 4. Focus on essential missile system logistics and repair services.
Value Assessment
Rating: questionable
The contract's Cost Plus Fixed Fee structure, combined with a sole-source award, makes a direct pricing comparison difficult. Without competitive bids, it's challenging to ascertain if the fixed fee accurately reflects market rates for similar logistics and repair services.
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 lack of competition limits price discovery and may result in less favorable terms for the government compared to a competitive procurement.
Taxpayer Impact: The absence of competition could lead to taxpayers potentially overpaying for essential missile support services.
Public Impact
Ensures continued operational readiness of the Patriot missile defense system. Supports U.S. Army and Foreign Military Sales (FMS) launcher repair. Maintains critical logistics infrastructure for a key defense asset. Potential for increased costs impacts overall defense budget allocation.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Cost-plus contract type
- Lack of competition
Positive Signals
- Essential defense system support
- Long-term contract duration
Sector Analysis
This contract falls within the defense sector, specifically focusing on guided missile and space vehicle parts and auxiliary equipment manufacturing. Spending benchmarks in this niche area are difficult to establish without comparable competitive contracts, but large sole-source awards warrant scrutiny.
Small Business Impact
The data indicates no specific set-aside for small businesses. Given the specialized nature of Patriot missile support and the sole-source award to a large prime contractor, small business participation is likely minimal or indirect.
Oversight & Accountability
The sole-source nature of this award necessitates robust oversight to ensure the fixed fee is reasonable and that Lockheed Martin is performing efficiently. The Department of the Army should actively monitor costs and performance metrics.
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 increases government risk
- Potential for inflated pricing
- Lack of transparency in pricing justification
- Limited small business participation opportunities
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 $59.6 million to LOCKHEED MARTIN CORPORATION. ATRIOT ADVANCED CAPABILITY-3 MISSILE SUPPORT CENTER (P3MSC) LOGISTICS SUPPORT, US LAUNCHER REPAIR & RETURN (R&R), AND FOREIGN MILITARY SALES (FMS) LAUNCHER R&R
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 $59.6 million.
What is the period of performance?
Start: 2024-03-27. End: 2027-04-01.
What is the justification for the sole-source award, and were alternative competitive strategies considered?
The justification for a sole-source award is typically based on factors like unique capabilities, urgent need, or lack of viable alternatives. Without further details on the specific justification, it's difficult to assess if alternative competitive strategies were thoroughly explored. A detailed review of the contracting officer's determination is needed to understand the rationale and ensure it aligns with federal procurement regulations.
How does the fixed fee in this Cost Plus Fixed Fee contract compare to industry benchmarks for similar missile support services?
Assessing the reasonableness of the fixed fee requires access to detailed cost breakdowns and industry benchmark data for specialized missile logistics and repair. Given the sole-source nature, direct comparison is challenging. The government should have conducted a thorough cost analysis, potentially using historical data or independent cost estimates, to validate the fixed fee's appropriateness.
What mechanisms are in place to ensure efficient performance and prevent cost overruns under this Cost Plus Fixed Fee contract?
Under a Cost Plus Fixed Fee contract, the government bears the cost risk, making efficient performance monitoring crucial. Mechanisms should include detailed performance metrics, regular progress reviews, audits of incurred costs, and clear communication channels with the contractor. The contracting officer must actively manage the contract to ensure the fixed fee is earned through efficient and effective service delivery.
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: $59,586,137
Exercised Options: $59,586,137
Current Obligation: $59,586,137
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: 2024-03-27
Current End Date: 2027-04-01
Potential End Date: 2027-04-01 12:04:00
Last Modified: 2025-05-21
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