Lockheed Martin awarded $30.3M for AN/TPQ-53 radar system, a sole-source contract for critical defense technology

Contract Overview

Contract Amount: $30,335,604 ($30.3M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2022-09-29

End Date: 2026-01-16

Contract Duration: 1,205 days

Daily Burn Rate: $25.2K/day

Competition Type: NOT COMPETED

Pricing Type: COST PLUS FIXED FEE

Sector: Defense

Official Description: THE PURPOSE OF THIS CONTRACT W56KGY22D0001 D.O. W56KGY22F0050 IS TO PROVIDE FUNDING FOR THE EDM EFFORT OF THE AN/TPQ-53.

Place of Performance

Location: LIVERPOOL, ONONDAGA County, NEW YORK, 13088

State: New York Government Spending

Plain-Language Summary

Department of Defense obligated $30.3 million to LOCKHEED MARTIN CORPORATION for work described as: THE PURPOSE OF THIS CONTRACT W56KGY22D0001 D.O. W56KGY22F0050 IS TO PROVIDE FUNDING FOR THE EDM EFFORT OF THE AN/TPQ-53. Key points: 1. Contract awarded to a single, established defense contractor, indicating specialized capabilities or limited market alternatives. 2. The contract type (Cost Plus Fixed Fee) allows for cost reimbursement plus a fixed fee, which can incentivize efficiency but requires careful oversight. 3. The duration of over 1000 days suggests a long-term need for the system's sustainment or development. 4. Awarded by the Department of the Army, this contract supports a specific radar system crucial for battlefield awareness. 5. The lack of competition raises questions about potential price efficiencies and the exploration of alternative solutions. 6. The contract's value, while substantial, needs to be benchmarked against similar systems and sustainment efforts.

Value Assessment

Rating: fair

The contract's Cost Plus Fixed Fee structure necessitates robust oversight to ensure costs remain reasonable and the fixed fee is justified. Benchmarking this award against similar sustainment contracts for advanced radar systems would provide a clearer picture of value for money. Without competitive bids, it's challenging to definitively assess if the pricing reflects market rates or if there's an opportunity for cost savings through competition.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one vendor, Lockheed Martin Corporation, was solicited. This approach is typically used when a unique capability is required, or when there is a lack of viable alternatives. The absence of competition means that price discovery through market forces was not utilized, potentially leading to higher costs than if multiple vendors had bid.

Taxpayer Impact: For taxpayers, a sole-source award means that the government did not benefit from competitive pricing, which could result in a higher overall expenditure for this system.

Public Impact

The primary beneficiaries are the U.S. Army personnel who will utilize the AN/TPQ-53 radar system for enhanced situational awareness and threat detection. The contract delivers funding for the sustainment and potential enhancement of the AN/TPQ-53 radar system, a critical component for military operations. The geographic impact is primarily within military installations and operational theaters where the Army deploys this technology. Workforce implications include continued employment for specialized engineers, technicians, and support staff at Lockheed Martin and its subcontractors involved in radar systems.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award limits competitive pressure, potentially impacting cost-effectiveness.
Cost Plus Fixed Fee contract type requires diligent oversight to manage costs and ensure fair profit.
Long contract duration may indicate potential for cost overruns if not managed proactively.
Lack of transparency in the justification for sole-source award.
Limited visibility into alternative technological solutions that may exist in the market.

Positive Signals

Award to a prime defense contractor with a proven track record in radar systems.
Contract supports a critical defense capability (AN/TPQ-53 radar) vital for national security.
Long-term contract provides stability for sustainment and potential upgrades of essential equipment.
Delivery order structure allows for phased funding and execution of work.

Sector Analysis

The defense electronics sector, particularly radar systems manufacturing, is characterized by high barriers to entry due to complex technology, significant R&D investment, and stringent government requirements. Lockheed Martin is a major player in this market. Spending in this area is driven by the need for advanced surveillance, targeting, and threat detection capabilities. Comparable spending benchmarks would involve analyzing other contracts for similar radar systems or electronic warfare equipment.

Small Business Impact

This contract does not appear to have a small business set-aside component, as indicated by 'sb': false. Furthermore, the 'no' field being 0 suggests no reported subcontracting goals or achievements at the prime contract level. This means that opportunities for small businesses to participate in this specific contract as subcontractors may be limited, and there is no explicit mechanism within this award to drive small business participation.

Oversight & Accountability

Oversight for this contract will likely be managed by the Department of the Army's contracting and program management offices. Accountability measures would be embedded in the contract terms, including performance metrics and reporting requirements. Transparency is facilitated through contract awards databases, but the specifics of cost justification for sole-source awards may be less public. Inspector General jurisdiction would apply to any allegations of fraud, waste, or abuse.

Related Government Programs

AN/TPQ-53 Radar System
Counter-Rocket, Artillery, and Mortar (C-RAM) Systems
Battlefield Surveillance Radar Programs
Defense Electronic Systems Sustainment
Tactical Radar Development

Risk Flags

Sole-source award may limit cost efficiencies.
Cost Plus Fixed Fee contract requires robust oversight.
Lack of competition could indicate market concentration or barriers to entry.

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $30.3 million to LOCKHEED MARTIN CORPORATION. THE PURPOSE OF THIS CONTRACT W56KGY22D0001 D.O. W56KGY22F0050 IS TO PROVIDE FUNDING FOR THE EDM EFFORT OF THE AN/TPQ-53.

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 $30.3 million.

What is the period of performance?

Start: 2022-09-29. End: 2026-01-16.

What is the specific justification for awarding this contract on a sole-source basis to Lockheed Martin?

The provided data does not explicitly state the justification for the sole-source award. Typically, sole-source contracts are awarded when only one responsible source is available or capable of meeting the government's needs. This could be due to proprietary technology, unique capabilities, or a lack of competition in the market for the specific requirements of the AN/TPQ-53 EDM effort. A full justification would usually be documented by the procuring agency, often including details on market research conducted to confirm the absence of other viable sources and the rationale for proceeding without competition.

How does the Cost Plus Fixed Fee (CPFF) contract type compare to other contract types in terms of risk and potential for cost savings?

Cost Plus Fixed Fee (CPFF) contracts reimburse the contractor for allowable costs incurred, plus a predetermined fixed fee representing profit. This type is often used for research and development or complex projects where cost estimation is difficult. While it provides flexibility and incentivizes the contractor to complete the work, it shifts cost risk towards the government. Compared to fixed-price contracts, CPFF can lead to higher overall costs if not managed diligently, as the government bears the brunt of cost overruns. However, it can be more efficient than cost-plus-award-fee or cost-plus-incentive-fee contracts if the fixed fee is set appropriately and performance is closely monitored.

What is the historical spending trend for the AN/TPQ-53 radar system or similar systems by the Department of the Army?

The provided data focuses on a single delivery order for the AN/TPQ-53 EDM effort. To assess historical spending trends, one would need to access broader contract databases to identify all previous contracts, delivery orders, and modifications related to the AN/TPQ-53 system, as well as comparable radar systems procured by the Department of the Army. Analyzing these historical data points would reveal the total investment in the system over time, identify periods of significant spending, and potentially highlight trends in sustainment versus procurement costs. Without this broader dataset, a historical spending trend cannot be determined from the given information.

What are the key performance indicators (KPIs) or deliverables expected under this contract?

The data indicates the contract is for the 'EDM EFFORT OF THE AN/TPQ-53,' which likely refers to Engineering, Development, and Manufacturing or a similar phase. Specific Key Performance Indicators (KPIs) and deliverables are not detailed in the provided snippet. However, for such a contract, typical KPIs might include system performance metrics (e.g., detection range, accuracy, reliability), adherence to technical specifications, timely delivery of prototypes or production units, and successful completion of testing phases. Deliverables would likely encompass technical documentation, test reports, and the radar system components themselves.

What is Lockheed Martin's track record with the AN/TPQ-53 or similar defense systems?

Lockheed Martin Corporation is a major defense contractor with extensive experience in developing and manufacturing complex defense systems, including radar and electronic warfare technologies. They have a significant history of producing and supporting various radar systems for military applications. While specific details on their performance for the AN/TPQ-53 are not in the provided data, their general track record suggests they possess the technical expertise and manufacturing capacity required for this contract. A deeper dive into past performance reviews and contract history for similar programs would offer a more precise assessment.

Industry Classification

NAICS: Manufacturing › Navigational, Measuring, Electromedical, and Control Instruments Manufacturing › Search, Detection, Navigation, Guidance, Aeronautical, and Nautical System and Instrument Manufacturing

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Pricing Type: COST PLUS FIXED FEE (U)

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: $30,335,604

Exercised Options: $30,335,604

Current Obligation: $30,335,604

Subaward Activity

Number of Subawards: 26

Total Subaward Amount: $2,521,094

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: YES

Parent Contract

Parent Award PIID: W56KGY22D0001

IDV Type: IDC

Timeline