DoD awards $196M for Fire Control Sights & Devices to Lockheed Martin, raising cost concerns

Contract Overview

Contract Amount: $320,029,330 ($320.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2005-01-26

End Date: 2011-01-21

Contract Duration: 2,186 days

Daily Burn Rate: $146.4K/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: 200504!002180!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0302 !A!N! !N! ! !20050126!20070731!196189385!196189385!834951691!N!LOCKHEED MARTIN CORPORATION !5600 WEST SAND LAKE ROAD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORANGE !FLORIDA !+000040400010!Y!N!000000000000!1220!FIRE CONTROL COMPUTING SIGHTS & DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !000 !* !336411!E! !1! ! ! ! ! !20200930!B! ! !A! !D!N!J!1!001!N!1A!A!N!F! ! !N!C!N! ! ! !A!A!A!A!000!A!C!N! ! ! ! ! ! !0001! !

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32819

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $320.0 million to LOCKHEED MARTIN CORPORATION for work described as: 200504!002180!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0302 !A!N! !N! ! !20050126!20070731!196189385!196189385!834951691!N!LOCKHEED MARTIN CORPORATION !5600 WEST SAND LAKE ROAD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORAN… Key points: 1. The contract for fire control sights and devices was awarded to Lockheed Martin Corporation. 2. The total value of the contract is $196,189,385. 3. This contract was not competed, raising questions about price discovery and potential overspending. 4. The sector is Defense, specifically Aircraft Manufacturing.

Value Assessment

Rating: concerning

The contract value of $196,189,385 for fire control sights and devices appears high, especially given the lack of competition. Benchmarking against similar contracts is difficult without more data, but the significant award amount warrants scrutiny.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

The contract was awarded using a sole-source (not competed) method. This limits price discovery and may lead to higher costs for taxpayers as there was no competitive pressure to drive down prices.

Taxpayer Impact: The lack of competition for this significant contract raises concerns about whether taxpayers received the best possible value for their investment.

Public Impact

Taxpayers may have overpaid due to the sole-source award of a $196M contract. The Department of Defense is procuring critical aircraft equipment without exploring competitive options. The long duration of the contract (2005-2011) for a sole-source award increases the risk of inflated costs over time.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Sole-source award
High contract value
Lack of competition
Potential for cost overruns

Positive Signals

Award to established defense contractor
Specific equipment for aviation and missile command

Sector Analysis

This contract falls within the Defense sector, specifically Aircraft Manufacturing. The award of $196M for fire control systems is substantial and highlights the significant investment in defense technology.

Small Business Impact

There is no indication in the data that small businesses were involved in this contract, either as prime contractors or subcontractors.

Oversight & Accountability

The sole-source nature of this large contract warrants close oversight to ensure fair pricing and effective delivery of essential defense equipment.

Related Government Programs

Aircraft Manufacturing
Department of Defense Contracting
Defense Contract Management Agency Programs

Risk Flags

Sole-source award lacks competition
High contract value raises cost concerns
Potential for taxpayer overpayment
Limited transparency in pricing
Long contract duration increases risk

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $320.0 million to LOCKHEED MARTIN CORPORATION. 200504!002180!2100!W58RGZ!USA AVIATION AND MISSILE COMMAND!W58RGZ04C0302 !A!N! !N! ! !20050126!20070731!196189385!196189385!834951691!N!LOCKHEED MARTIN CORPORATION !5600 WEST SAND LAKE ROAD !ORLANDO !FL!32819!53000!095!12!ORLANDO !ORANGE !FLORIDA !+000040400010!Y!N!000000000000!1220!FIRE CONTROL COMPUTING SIGHTS & DEVICES !A1C!OTHER AIRCRAFT EQUIPMENT !000 !* !336411!E! !1! ! ! ! ! !202

Who is the contractor on this award?

The obligated recipient is LOCKHEED MARTIN CORPORATION.

Which agency awarded this contract?

Awarding agency: Department of Defense (Defense Contract Management Agency).

What is the total obligated amount?

The obligated amount is $320.0 million.

What is the period of performance?

Start: 2005-01-26. End: 2011-01-21.

What was the justification for awarding this contract on a sole-source basis instead of seeking competitive bids?

The justification for a sole-source award typically involves factors such as unique capabilities, urgent need, or lack of viable alternatives. Without further documentation, it's impossible to definitively state the reason. However, the absence of competition for a nearly $200 million contract raises questions about whether all avenues for competitive sourcing were fully explored.

How does the unit cost of these fire control sights and devices compare to similar systems procured competitively?

Direct comparison of unit costs is challenging without specific unit pricing data and detailed specifications for comparable systems. However, given the sole-source nature of this award, there is a heightened risk that the unit costs may be higher than what could have been achieved through a competitive bidding process. Further analysis would require access to detailed cost breakdowns and market research.

What is the potential impact on future defense procurement strategies if sole-source awards of this magnitude become commonplace?

If sole-source awards of this magnitude become commonplace, it could significantly reduce competitive pressure within the defense industrial base. This may lead to sustained higher costs for taxpayers, stifle innovation from smaller or emerging companies, and potentially reduce the overall efficiency of defense spending. It could also create a perception of favoritism and reduce transparency in government contracting.

Industry Classification

NAICS: Manufacturing › Aerospace Product and Parts Manufacturing › Aircraft Manufacturing

Product/Service Code: FIRE CONTROL EQPT.

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp (UEI: 834951691)

Address: 5600 WEST SAND LAKE ROAD, ORLANDO, FL, 90

Business Categories: Category Business, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Contract Characteristics

Cost or Pricing Data: NO

Timeline