DoD's $48.4M contract for LAV-AT A1 mobile platoons awarded to Lockheed Martin Corporation

Contract Overview

Contract Amount: $48,415,270 ($48.4M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2016-11-15

End Date: 2019-12-31

Contract Duration: 1,141 days

Daily Burn Rate: $42.4K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: Defense

Official Description: LAV-AT A1 FULL FIDELITY MOBILE PLATOON

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32825

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $48.4 million to LOCKHEED MARTIN CORPORATION for work described as: LAV-AT A1 FULL FIDELITY MOBILE PLATOON Key points: 1. Contract value represents a significant investment in mobile platoon capabilities. 2. Sole-source award raises questions about potential price overruns and limited market engagement. 3. Contract duration of over three years suggests a substantial, ongoing need for these systems. 4. The 'Other Commercial and Service Industry Machinery Manufacturing' PSC code is broad and may obscure specific technological components. 5. Fixed-price contract type aims to control costs, but the lack of competition could negate this benefit. 6. Geographic location in Florida for contract performance warrants scrutiny for potential regional economic impacts.

Value Assessment

Rating: questionable

Benchmarking the value of this contract is challenging due to the lack of publicly available comparable sole-source awards for similar mobile platoon systems. The fixed-price nature suggests an attempt to cap costs, but without competitive bidding, it's difficult to ascertain if the $48.4 million represents a fair market price. The contract's value should be assessed against the specific capabilities and technological advancements delivered by the LAV-AT A1 system.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, meaning only one bidder, Lockheed Martin Corporation, was considered. This significantly limits the opportunity for price discovery and potentially leads to higher costs for the government compared to a fully competed procurement. The justification for a sole-source award, if provided, would be critical to understanding why other potential suppliers were not engaged.

Taxpayer Impact: Sole-source awards mean taxpayers may not be getting the best possible price, as competition is a key driver for cost savings in government contracting.

Public Impact

The primary beneficiaries are the U.S. Army units equipped with the LAV-AT A1 mobile platoons, enhancing their operational readiness and capabilities. The contract delivers advanced mobile platoon systems, likely including armored vehicles and associated support equipment. Contract performance is located in Florida, potentially creating or sustaining jobs within the state's defense manufacturing sector. The acquisition of these systems supports the modernization of military equipment and ensures troops have access to relevant technology.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Lack of competition may lead to inflated pricing.
Sole-source awards can reduce transparency in the procurement process.
Potential for vendor lock-in with a single supplier for critical systems.

Positive Signals

Fixed-price contract type helps to define cost expectations.
Award to a major defense contractor like Lockheed Martin suggests a focus on proven capabilities.
Contract duration indicates a long-term commitment to equipping military units.

Sector Analysis

The defense sector, particularly armored vehicle manufacturing, is characterized by high R&D costs, long production cycles, and significant government investment. Contracts like this are typical for acquiring specialized military hardware. The market is often dominated by a few large prime contractors, making sole-source awards more common for highly specific or technologically advanced systems where only one entity possesses the required expertise or intellectual property. Comparable spending benchmarks would involve analyzing other contracts for similar armored vehicle platforms or mobile command and control systems.

Small Business Impact

There is no indication of small business set-asides for this contract, nor are there explicit subcontracting requirements mentioned in the provided data. This suggests that small businesses may not be directly benefiting from this specific award, although they could potentially be involved as lower-tier subcontractors to Lockheed Martin. The absence of set-asides means opportunities for small business innovation and participation in this particular procurement are limited.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are inherent in the fixed-price contract type, which obligates the contractor to deliver specified goods or services within a set budget. Transparency is limited due to the sole-source nature of the award; further details would likely be available through Freedom of Information Act requests or specific Inspector General reports if any issues arise.

Related Government Programs

Light Armored Vehicles (LAV)
Mobile Command and Control Systems
Department of Defense Procurement
Army Vehicle Modernization Programs

Risk Flags

Sole-source award
Lack of competition
Potential for cost overruns
Limited transparency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $48.4 million to LOCKHEED MARTIN CORPORATION. LAV-AT A1 FULL FIDELITY MOBILE PLATOON

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 $48.4 million.

What is the period of performance?

Start: 2016-11-15. End: 2019-12-31.

What specific capabilities does the LAV-AT A1 mobile platoon system offer, and how do these capabilities justify a sole-source award?

The LAV-AT A1 (Light Armored Vehicle - Anti-Tank) mobile platoon system is designed to provide armored protection and anti-tank missile capabilities to infantry platoons. Its primary function is to enhance the survivability and firepower of dismounted troops by offering mobile, protected firing positions. The justification for a sole-source award would likely stem from unique technological features, proprietary systems, or a specific integration with existing Army platforms that only Lockheed Martin possesses or can provide. Without detailed technical specifications and a formal justification document, it is difficult to definitively assess the necessity of a sole-source procurement over a competitive one. However, such systems often involve complex integration and specialized weaponry that may limit the pool of qualified bidders.

How does the $48.4 million contract value compare to historical spending on similar armored vehicle systems?

Comparing the $48.4 million contract value for the LAV-AT A1 mobile platoons requires identifying truly comparable systems. If this contract covers the procurement of a significant number of vehicles and associated support over its duration, the cost per unit could be estimated. For instance, if the contract is for 50 vehicles, the average cost per vehicle would be approximately $968,000. Historical data on similar light armored vehicles, such as the Stryker family or other MRAP variants, would be needed for a robust comparison. However, sole-source awards often deviate from market norms, making direct comparisons difficult. The value should also be assessed against the system's technological sophistication and intended operational role.

What are the potential risks associated with a sole-source award for critical military hardware like the LAV-AT A1?

The primary risk of a sole-source award for critical military hardware is the lack of competitive pressure, which can lead to inflated prices and reduced innovation. Taxpayers may end up paying more than necessary for the systems. Furthermore, sole-source contracts can create vendor lock-in, making it difficult and costly to switch suppliers in the future, even if better alternatives emerge. There's also a potential reduction in transparency and accountability, as the justification for not competing the award might obscure underlying issues. Finally, the government might miss out on potentially superior or more cost-effective solutions that could have been offered by other manufacturers in a competitive bidding process.

What is Lockheed Martin Corporation's track record with Department of Defense contracts, particularly for armored vehicles?

Lockheed Martin Corporation is one of the largest defense contractors globally and has an extensive track record with the Department of Defense, including numerous contracts for armored vehicles and related systems. They are known for producing platforms like the Paladin Integrated Weapons System, the M2/M3 Bradley Fighting Vehicle, and various components for other armored platforms. Their history includes both successful large-scale programs and instances of cost overruns or schedule delays, which is common for complex defense acquisition programs. The company's experience suggests a high level of technical capability, but also underscores the importance of robust contract management and oversight to ensure value for taxpayer money.

What are the implications of the contract's performance period (2016-2019) on current military readiness and future procurement strategies?

The contract's performance period from 2016 to 2019 means the LAV-AT A1 mobile platoons procured under this award have been in service for several years. This timeframe is significant because military technology evolves rapidly. Systems acquired during that period may be nearing the end of their initial service life or require upgrades to meet current threats and operational demands. The experience gained from operating these systems would inform future procurement strategies, potentially leading to requirements for upgraded versions, replacements, or entirely new platforms. Understanding the operational effectiveness and sustainment costs of these systems is crucial for planning future defense budgets and acquisition programs.

Industry Classification

NAICS: Manufacturing › Commercial and Service Industry Machinery Manufacturing › Other Commercial and Service Industry Machinery Manufacturing

Product/Service Code: TRAINING AIDS AND DEVICES

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: W900KK16R0009

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Lockheed Martin Corp

Address: 100 GLOBAL INNOVATION CIR, ORLANDO, FL, 32825

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: $48,415,270

Exercised Options: $48,415,270

Current Obligation: $48,415,270

Subaward Activity

Number of Subawards: 33

Total Subaward Amount: $6,786,189

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline