Image: Lockheed Martin
Derco, a Lockheed Martin subsidiary, has secured a new performance-based logistics contract to support the US military’s C-130 Hercules fleet, strengthening sustainment for one of the Pentagon’s most critical airlifters.
The Defense Logistics Agency (DLA) awarded Derco the C-130 Aviation Consumables Performance Based Logistics (ACPBL) contract, according to a company statement. The agreement focuses on ensuring the availability of consumable spare parts required to maintain fleet readiness across global operations.
The award represents a notable milestone for both parties. It marks Derco’s latest achievement in more than 45 years of aerospace and defence sustainment work. It also represents the first outcome-based logistics programme executed between DLA and Lockheed Martin under this specific effort.
Performance-based sustainment model
Under the ACPBL contract, Derco will deliver performance-based support for newly manufactured C-130 consumable spare parts. The scope includes demand forecasting, inventory management, warehousing, engineering support, and on-the-ground field service representatives.
The performance-based approach ties contractor compensation to measurable outcomes, such as material availability and supply responsiveness. The model aims to reduce delays, stabilise supply chains, and improve aircraft mission-capable rates.
DLA manages the majority of consumable items used by US military aircraft. These parts, while often low-cost individually, can ground aircraft when unavailable. The agency has increasingly relied on performance-based logistics contracts to improve efficiency and readiness.
Derco will work closely with DLA supply chain managers to align forecasting and inventory decisions with operational demand across the C-130 enterprise.
Focus on readiness and availability
Kathy Medalle, Derco’s president and general manager, said the contract reflects a shared focus on readiness and material availability.
“We are thrilled to be partnered with the DLA in support of the Lockheed Martin C-130 Hercules,” Medalle said, according to the company release. She added that both organisations share a mission to drive mission capability rates and warfighter readiness.
Medalle described the award as evidence of a strong working relationship between DLA and Lockheed Martin. She also highlighted a joint commitment to innovation and operational excellence.
The contract reinforces Derco’s role as a sustainment specialist within Lockheed Martin’s broader defence portfolio. The company supports military and commercial aircraft programmes through supply chain management, repair services, and engineering support.
Sustaining a global workhorse
The Lockheed Martin C-130 Hercules remains one of the most widely used military transport aircraft in the world. The platform has served for more than 70 years across tactical airlift, humanitarian relief, disaster response, aerial firefighting, and special operations missions.
More than 20 countries operate variants of the aircraft. US Air Force, Marine Corps, and allied fleets rely on the C-130 for operations in austere and contested environments.
Sustaining the aircraft presents ongoing logistical challenges due to its long service life and broad mission set. Reliable access to consumable spare parts plays a critical role in keeping aircraft available for tasking.
According to Derco, the ACPBL contract will help stabilise supply chains and improve responsiveness to operational demand. The company also said the programme supports small business participation across the defence industrial base.
Broader defence logistics implications
The award reflects DLA’s continued emphasis on outcome-driven sustainment strategies. Performance-based logistics has become a key tool for managing ageing fleets while controlling costs and improving readiness.
For Lockheed Martin and Derco, the contract strengthens long-term engagement with US defence logistics authorities. It also underscores the enduring importance of the C-130 within US and allied force structures.
Derco said the partnership contributes directly to national security by supporting aircraft readiness and operational availability, according to the company statement.
Source: Lockheed Martin Press Release
