DoD Awards $374M for Patriot Missile Support to Lockheed Martin, Lacking Competition
Contract Overview
Contract Amount: $37,420,166 ($37.4M)
Contractor: Lockheed Martin Corporation
Awarding Agency: Department of Defense
Start Date: 2025-07-08
End Date: 2027-07-07
Contract Duration: 729 days
Daily Burn Rate: $51.3K/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 $37.4 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. Significant contract value of $374 million for critical missile support. 2. Sole-source award to Lockheed Martin raises concerns about price discovery. 3. Potential for higher costs due to lack of competitive bidding. 4. Focus on advanced missile systems highlights strategic defense spending.
Value Assessment
Rating: questionable
The contract value of $374 million for PAC-3 missile support is substantial. Without competitive bidding, it's difficult to assess if this price is optimal compared to potential alternatives or previous contracts for similar 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 limits price discovery and may result in less favorable terms for the government.
Taxpayer Impact: Taxpayers may bear a higher cost due to the absence of competitive pressure to lower prices.
Public Impact
Ensures continued operational readiness of the critical Patriot missile defense system. Supports both U.S. military readiness and security cooperation with FMS customers. Maintains essential technical expertise and supply chain for advanced missile components.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Lack of competition
- Sole-source award
- Potential for cost overruns
Positive Signals
- Critical defense system support
- Long-term sustainment
- Foreign military sales
Sector Analysis
This contract falls within the defense sector, specifically focusing on missile systems and support. Spending in this area is critical for national security, but often involves high costs and limited competition due to specialized technology.
Small Business Impact
The awardee is Lockheed Martin Corporation, a large prime contractor. There is no indication in the provided data that small businesses will be significantly involved in this specific contract, either as subcontractors or direct awardees.
Oversight & Accountability
The Department of the Army awarded this contract. Oversight will be crucial to ensure performance, cost control, and adherence to contract terms, especially given the sole-source nature.
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
- Lack of competitive bidding
- Potential for cost overruns
- Reliance on a single supplier
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 $37.4 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 $37.4 million.
What is the period of performance?
Start: 2025-07-08. End: 2027-07-07.
What is the justification for the sole-source award, and what steps are being taken to ensure fair pricing?
The justification for a sole-source award typically involves unique capabilities or proprietary technology held by a single contractor. The Department of Defense should have a documented rationale. To ensure fair pricing, mechanisms like cost realism analyses, independent government cost estimates, and robust negotiation strategies are employed, though competition remains the most effective price control.
What are the risks associated with relying on a single supplier for critical missile support?
Relying on a single supplier like Lockheed Martin for PAC-3 missile support introduces risks such as supply chain disruptions, potential price gouging due to lack of alternatives, and vendor lock-in. It also limits opportunities for innovation from other potential providers and can reduce the government's leverage in future negotiations.
How does this contract contribute to the overall effectiveness and readiness of U.S. air and missile defense capabilities?
This contract is vital for maintaining the operational readiness and effectiveness of the Patriot Advanced Capabilities-3 (PAC-3) missile system, a cornerstone of U.S. and allied air defense. It ensures the system remains functional, supported, and capable of intercepting threats, thereby directly contributing to national security and strategic deterrence.
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: $37,420,166
Exercised Options: $37,420,166
Current Obligation: $37,420,166
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: 2025-07-08
Current End Date: 2027-07-07
Potential End Date: 2027-07-07 12:07:00
Last Modified: 2025-09-24
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