WT Business Beat

By Nick Wakeman

Blog archive
Nick Wakeman

Lockheed fights back against canceled DHS contract

I can only imagine the frustration over at Lockheed Martin.

Twice the company has won a Customs and Border Protection contract to support part of the Automated Customs Environment, and twice the contract has been pulled away in the face of protests.

The first time, the Homeland Security Department decided to take a corrective action, which resulted in Lockheed winning the contract.

But this time, DHS has cancelled the solicitation and terminated Lockheed’s contract.

It’s unclear at this time what is DHS’s strategy going forward. But Lockheed isn’t pleased and has filed a protest objecting to the termination.

The company issued a statement to me that reads: “We firmly believe that Lockheed Martin had the strongest technical solution and provided the best value in terms of pricing, experience and teaming to help Customs and Border Protection achieve its cargo processing mission, which was demonstrated by the decision to twice award us the contract.”

The ACE contract has been a $5 billion dollar effort to build a system to monitor and clear the movement of goods across U.S. borders. It plays a significant anti-terrorism role. IBM won the contract in 2001.

But when it came time to recompete the contract, DHS broke it up into smaller procurements.

Lockheed, who had been a partner to IBM, pursued one of the contracts on its own. After the company won the contract, IBM and another bidder, Avaya, filed protests with the Government Accountability Office.

Something in this second round of protests has led DHS to cancel the solicitation. The records on the protests are not public, and no one is talking.

But IBM and Avaya must have raised significant issues with the solicitation and the selection process because generally, agencies will take a corrective action, usually opening new discussions with bidders and re-evaluating bids.

But a cancelation is a step well beyond a corrective action. DHS is now back at square one.

We are probably looking at another year before this contract is awarded. And probably more protests.

IBM and Avaya are probably pleased to have the chance to win, and of course, Lockheed is frustrated.

I’m not taking any sides here with the companies. IBM and Avaya are well within their rights to protest and should if that’s the best way to protect their interests.

But the constant churn of bid protests are wasteful and point to more systemic problems with the procurement system.

That’s no great insight, just the sad state of contracting today.

Posted by Nick Wakeman on Sep 17, 2014 at 9:23 AM

Reader Comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above.

WT Daily

Sign up for our newsletter.

Terms and Privacy Policy consent

I agree to this site's Privacy Policy.