Providing our customers with innovative tech at a faster pace and lower cost is something we strive to do every day. Our latest indefinite delivery/indefinite quantity (ID/IQ) contract with the U.S. Department of Defense will do that with some of our key sensor capabilities for fixed wing aircraft.
Last week, the U.S. Department of Defense awarded us a $485 million ID/IQ contract to rapidly deploy sensor capabilities to the U.S. and its allies. For the next five years, we’ll be able to offer pre-priced sensor technologies, including Sniper® Advanced Targeting Pod (ATP), LANTIRN™ Extended Range (ER) Upgrades and Infrared Search and Track (IRST) systems.
But what does that mean for the warfighter and our relationship with our customers? Let’s break it down.
Greater Flexibility and Cost Stability
ID/IQ contracts provide for unlimited services for a fixed time. That means we can offer the newest capabilities at a faster rate and bolster the military industrial base on an as-needed basis.
With an ID/IQ, overarching terms and conditions are negotiated and pricing tables are established, making this essentially a one-and-done contract as far as the proposal process is concerned. Specifically, the ID/IQ contract is for a period of five years, which means the program will not need to prepare a related proposal for several years.
Better Support for Foreign Customers
In addition to U.S. military sales, the contract enables Bahrain, Belgium, Bulgaria, Canada, Egypt, Greece, Indonesia, Iraq, Israel, Jordan, Republic of Korea, Kuwait, Morocco, Netherlands, Norway, Oman, Pakistan, Poland, Qatar, Romania, Saudi Arabia, Slovakia, Taiwan, Thailand and Turkey to purchase the airborne sensors.
Without an ID/IQ in place, our program team has to prepare and negotiate numerous proposals for the same scope for each foreign military end user, thus taxing manpower at Lockheed Martin and with our customer due to the continuous cycle of definitizations. However, with the ID/IQ, overarching terms and conditions are negotiated and pricing tables are established, creating essentially a one-and-done contract.
With our ID/IQ, customers can contract immediately. An ID/IQ contract provides our Foreign Military Services (FMS) end users and the U.S. government the ability to quickly issue an order under the ID/IQ contract and enables more agility during the acquisition process while also protecting our business objectives and mitigating risk.
A typical contract could take upwards of two years from receipt of the request for proposal to when the contract gets awarded.
ID/IQ contracts provide a great solution for the military so we can keep our frontlines safe, and bring them home.