Big Defense Contractors Win Big in Pentagon Contracts Announcement

The Department of Defense awarded 10 defense contracts Friday, worth $298.5 million altogether. The biggest of these contracts, consuming more than two-thirds of the funds on offer, went to two of America's biggest defense contractors: Lockheed Martin (NYSE: LMT  ) and United Technologies (NYSE: UTX  ) .

UTC's award was the larger by a hair, a $105.2 million fixed-price-incentive-fee advance acquisition contract awarded to subsidiary Pratt & Whitney Military Engines to fund the purchase of long-lead components, parts, and materials needed to build 53 low-rate initial production Lot IX F-135 engines for installation aboard F-35 Lightning II Joint Strike Fighters. These parts will be used to build:

  • 26 F-135-PW-100 engines for the U.S. Air Force
  • six F-135-PW-600 engines for the U.S. Marine Corps
  • two F-135-PW-100 engines for the U.S. Navy
  • 13 F-135-PW-100 and 6 F135-PW-600 engines for international partners and foreign military sales customers

Deliveries should be completed sometime in September 2017.

For its part, Lockheed Martin won two contracts:

  • The day's second largest -- a $91.8 million firm-fixed-price contract modification to pay for spare parts that will be used in the C-5 Reliability Enhancement and Re-engining Program (RERP) . This contract will be completed by July 29, 2016.
  • A $12.2 million cost-plus-fixed-fee, foreign military sales contract to upgrade aircraft mission systems aboard two Royal Norwegian Air Force (RNoAF) P-3C sub-hunting aircraft by October 2015. 

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Rich Smith

As a defense writer for The Motley Fool, I focus on defense and aerospace stocks. My job? Every day of the week, I'm monitoring the news, figuring out the winners and losers, and tracking down the promising companies for you to invest in. Follow me on Twitter or Facebook for the most important developments in defense & aerospace, and other great stories.

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8/28/2015 4:02 PM
LMT $203.90 Down -0.03 -0.01%
Lockheed Martin Co… CAPS Rating: ****
UTX $93.24 Down -0.03 -0.03%
United Technologie… CAPS Rating: ****