DoD Awards $31.6M for PAC-3 Missile Support to Lockheed Martin, Lacking Competition
Contract Overview
Contract Amount: $31,575,690 ($31.6M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2025-05-20
End Date: 2029-08-22
Contract Duration: 1,555 days
Daily Burn Rate: $20.3K/day
Competition Type: NOT COMPETED
Pricing Type: COST PLUS FIXED FEE
Sector: Defense
Official Description: THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITIES-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE UNITED STATES 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 $31.6 million to LOCKHEED MARTIN CORPORATION for work described as: THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITIES-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE UNITED STATES AND FOREIGN MILITARY SALES (FMS) CUSTOMERS. Key points: 1. Contract awarded to Lockheed Martin for critical PAC-3 missile support. 2. Significant funding allocated for both U.S. and Foreign Military Sales. 3. Lack of competition raises concerns about potential price inflation. 4. The contract supports specialized missile components and auxiliary equipment.
Value Assessment
Rating: questionable
The contract's value of $31.6 million for PAC-3 missile support is substantial. Without competitive bidding, it's difficult to assess if this price represents fair market value compared to similar specialized defense contracts.
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 the government and FMS customers.
Taxpayer Impact: The lack of competition could lead to taxpayers bearing a higher cost for essential missile support services.
Public Impact
Ensures continued operational readiness for the PAC-3 missile defense system. Supports U.S. allies through Foreign Military Sales, bolstering international security. Potential for increased costs due to sole-source nature impacts defense budget. Highlights reliance on a single contractor for critical missile components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Sole-source award
- Lack of price competition
- Potential for cost overruns
Positive Signals
- Supports critical missile defense system
- Includes FMS customers
- Long-term support contract
Sector Analysis
This contract falls within the defense sector, specifically focusing on guided missile and space vehicle parts. Spending in this niche area is often characterized by high R&D costs and limited supplier bases, making competition challenging but crucial.
Small Business Impact
The data indicates this contract was not awarded to small businesses. There is no information provided on subcontracting opportunities for small businesses within this award.
Oversight & Accountability
The sole-source nature of this award warrants close oversight to ensure costs are reasonable and performance meets requirements. Transparency in pricing and justification for the lack of competition is essential.
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 price competition.
- Potential for higher costs due to lack of competitive bidding.
- Reliance on a single contractor for critical defense components.
- Limited transparency on cost justification for sole-source award.
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 $31.6 million to LOCKHEED MARTIN CORPORATION. THIS CONTRACT IS FOR PATRIOT ADVANCED CAPABILITIES-3 (PAC-3) MISSILE SUPPORT CENTER (P3MSC) FOR THE UNITED STATES 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 $31.6 million.
What is the period of performance?
Start: 2025-05-20. End: 2029-08-22.
What is the justification for not competing this contract, given the significant dollar amount and the critical nature of PAC-3 missile support?
The justification for a sole-source award typically involves factors such as unique capabilities, proprietary technology, or urgent need where only one source can fulfill the requirement. For PAC-3 support, it might relate to Lockheed Martin's exclusive knowledge of the system's intricacies and manufacturing processes, making it the only viable provider without extensive technology transfer and requalification.
How will the Department of Defense ensure cost-effectiveness and prevent potential overpricing given the sole-source nature of this contract?
The DoD can employ several strategies to mitigate cost risks in sole-source contracts. This includes rigorous cost analysis, benchmarking against historical data or similar systems, negotiating profit margins carefully, and potentially incorporating performance incentives. Regular audits and close monitoring of expenditures are also crucial to ensure taxpayer funds are used efficiently.
What is the long-term strategy for fostering competition in the PAC-3 missile support ecosystem to reduce reliance on a single provider?
The long-term strategy might involve breaking down the support into smaller, more competitive components, encouraging the development of alternative suppliers through R&D initiatives, or exploring technology transfer agreements. The DoD could also set clear timelines for transitioning towards a more competitive environment once initial support needs are met and necessary data packages are available.
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: $31,575,690
Exercised Options: $31,575,690
Current Obligation: $31,575,690
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: 2025-05-20
Current End Date: 2029-08-22
Potential End Date: 2029-08-22 12:08:00
Last Modified: 2025-10-23
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