Lockheed Martin awarded $38M for Army training aids maintenance, a significant task order

Contract Overview

Contract Amount: $37,995,649 ($38.0M)

Contractor: Lockheed Martin Corporation

Awarding Agency: Department of Defense

Start Date: 2020-07-01

End Date: 2021-06-30

Contract Duration: 364 days

Daily Burn Rate: $104.4K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: COST NO FEE

Sector: Defense

Official Description: ARMY TRAINING AIDS, DEVICES, SIMULATORS AND SIMULATIONS (TADSS) MAINTENANCE PROGRAM (ATMP) AWARD OF TASK ORDER 0308.

Place of Performance

Location: ORLANDO, ORANGE County, FLORIDA, 32801

State: Florida Government Spending

Plain-Language Summary

Department of Defense obligated $38.0 million to LOCKHEED MARTIN CORPORATION for work described as: ARMY TRAINING AIDS, DEVICES, SIMULATORS AND SIMULATIONS (TADSS) MAINTENANCE PROGRAM (ATMP) AWARD OF TASK ORDER 0308. Key points: 1. This contract represents a substantial investment in maintaining critical training infrastructure. 2. The full and open competition suggests a potentially competitive bidding process. 3. Performance duration of one year requires close monitoring for timely delivery. 4. The cost-plus-fixed-fee contract type warrants scrutiny of cost control measures. 5. This award falls within the broader scope of defense readiness and simulation services. 6. The single delivery order indicates a specific, defined need within the larger program.

Value Assessment

Rating: fair

The contract's cost-plus-fixed-fee (CPFF) structure can lead to cost overruns if not managed tightly. Benchmarking against similar maintenance contracts for training systems is difficult without more detailed cost breakdowns. The fixed fee component provides some cost certainty, but the overall value depends heavily on the efficiency of the contractor's performance and the accuracy of the initial cost estimates.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that multiple bidders were likely solicited. This approach generally promotes competitive pricing and allows the government to select the best value offer. The number of bidders and the specific evaluation criteria would provide further insight into the strength of the competition.

Taxpayer Impact: A competitive bidding process for this contract helps ensure that taxpayer dollars are used efficiently by driving down costs and encouraging high-quality service delivery.

Public Impact

U.S. Army personnel benefit from reliable and advanced training simulators and devices. Ensures the operational readiness of critical training systems for soldiers. Services are primarily delivered in Florida, supporting regional military operations. The contract supports specialized technical roles in maintaining complex simulation equipment.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Cost-plus-fixed-fee contracts require diligent oversight to prevent scope creep and ensure cost efficiency.
The single delivery order nature might indicate a need for careful planning to avoid future sole-source extensions if the need persists.
Reliance on a single large contractor for critical maintenance could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, suggesting a robust selection process.
The fixed fee component provides a degree of cost predictability for the government.
The contract supports essential military training capabilities, contributing to national security.

Sector Analysis

This contract falls within the Defense sector, specifically supporting simulation and training technologies. The market for defense simulation and training is substantial, driven by the need for realistic and cost-effective soldier training. Companies like Lockheed Martin are major players in this space, offering a wide range of solutions from hardware to integrated training systems. Spending in this area is often characterized by long-term programs and complex technological requirements.

Small Business Impact

The contract data indicates that small business participation was not a stated requirement (sb: false). There is no explicit mention of small business set-asides or subcontracting plans. This suggests that the primary focus was on large prime contractors, and the impact on the small business ecosystem would likely be indirect, potentially through opportunities with the prime contractor if they choose to subcontract.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Army's contracting and program management offices. Accountability measures are embedded in the contract terms, including performance standards and payment schedules tied to delivery. Transparency is facilitated through contract award databases, though detailed performance metrics are often internal. Inspector General jurisdiction would apply in cases of fraud, waste, or abuse.

Related Government Programs

Army Training Aids, Devices, Simulators and Simulations (TADSS) Maintenance Program (ATMP)
Department of Defense Simulation and Training Technology
Military Readiness and Training Support Contracts

Risk Flags

Cost Overrun Potential (CPFF)
Performance Risk (Maintenance Schedule/Quality)
Contractor Dependency

Frequently Asked Questions

What is this federal contract paying for?

Department of Defense awarded $38.0 million to LOCKHEED MARTIN CORPORATION. ARMY TRAINING AIDS, DEVICES, SIMULATORS AND SIMULATIONS (TADSS) MAINTENANCE PROGRAM (ATMP) AWARD OF TASK ORDER 0308.

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 $38.0 million.

What is the period of performance?

Start: 2020-07-01. End: 2021-06-30.

What is Lockheed Martin's track record with similar Army training systems maintenance contracts?

Lockheed Martin Corporation has a long-standing and extensive history of supporting U.S. military training systems, including simulators and devices. They are a prime contractor on numerous programs involving the development, integration, and sustainment of complex training technologies across various branches of the armed forces. Their experience with the Army Training Aids, Devices, Simulators and Simulations (TADSS) Maintenance Program (ATMP) specifically, and similar sustainment contracts, suggests a deep understanding of the technical requirements and operational needs. While specific performance metrics for past contracts are often proprietary, their continued selection for significant sustainment efforts indicates a generally positive track record in delivering required services and maintaining critical training infrastructure.

How does the $38 million award compare to historical spending on Army training aids maintenance?

The $38 million award for this specific task order represents a significant, but not unprecedented, level of spending for a single maintenance contract within the broader Army Training Aids, Devices, Simulators and Simulations (TADSS) Maintenance Program (ATMP). Historical spending on ATMP and similar sustainment programs can fluctuate annually based on program needs, equipment lifecycle, and budget allocations. While this single task order is substantial, it should be viewed in the context of the overall ATMP budget, which likely encompasses multiple contracts and task orders over several years. Analyzing year-over-year spending trends for the entire ATMP would provide a clearer picture of whether this award signifies an increase or a stable level of investment in training system maintenance.

What are the primary risks associated with this contract, and how are they mitigated?

The primary risks associated with this Cost Plus Fixed Fee (CPFF) contract include potential cost overruns if contractor efficiency is low or unforeseen technical issues arise, and performance risks if the contractor fails to meet maintenance schedules or quality standards. Mitigation strategies employed by the government typically involve rigorous oversight of contractor expenditures, regular performance reviews against defined metrics, and clear contractual remedies for non-performance. The fixed fee component provides some incentive for the contractor to control costs. Additionally, the full and open competition process aims to select a contractor with a proven ability to manage such complex sustainment efforts, thereby reducing performance risk.

How effective is the CPFF contract type for ensuring value for money in training system maintenance?

The Cost Plus Fixed Fee (CPFF) contract type aims to balance risk and reward between the government and the contractor. For complex services like training system maintenance, where exact costs can be difficult to predict upfront, CPFF allows for flexibility. The 'cost plus' element covers allowable costs incurred by the contractor, while the 'fixed fee' represents the contractor's profit, which is negotiated upfront and does not change unless the scope of work is formally modified. This structure can incentivize the contractor to perform the work efficiently to maximize their profit margin within the fixed fee. However, it requires robust government oversight to ensure that all claimed costs are reasonable, allocable, and necessary, and that the contractor is not incentivized to incur unnecessary costs to justify a higher base for future contracts. Value for money is achieved when the fixed fee is competitive and the contractor delivers high-quality services within the estimated cost parameters.

What is the strategic importance of maintaining these training aids and simulators for the U.S. Army?

Maintaining training aids, devices, simulators, and simulations (TADSS) is strategically vital for the U.S. Army. These systems provide realistic, safe, and cost-effective training environments that replicate complex combat scenarios, vehicle operations, and weapon systems. Effective maintenance ensures that soldiers can train on up-to-date and fully functional equipment, enhancing their skills, decision-making abilities, and overall combat readiness without the high costs and risks associated with live-fire exercises or field training. Reliable TADSS are crucial for preparing soldiers for deployment in diverse and challenging operational environments, directly contributing to mission success and force preservation.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Architectural, Engineering, and Related Services › Engineering Services

Product/Service Code: MAINT, REPAIR, REBUILD EQUIPMENT › MAINT, REPAIR, REBUILD OF EQUIPMENT

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Solicitation ID: W900KK17R0034

Pricing Type: COST NO FEE (S)

Evaluated Preference: NONE

Contractor Details

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: $38,016,723

Exercised Options: $38,016,723

Current Obligation: $37,995,649

Subaward Activity

Number of Subawards: 97

Total Subaward Amount: $32,261,748

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: W900KK18D0018

IDV Type: IDC

Timeline