Under a contract that could total $8.15 billion, the aerospace giant will develop a capsule-shaped vehicle similar in appearance to the one that took an earlier generation of astronauts to the moon during Apollo. NASA hopes to use the vehicle, named Orion, to get back to the moon by 2020 and then set sail for Mars.
"Space is no longer going to be a destination that we visit briefly," said Scott J. Horowitz, associate administrator of NASA's exploration systems mission directorate.
Bethesda-based Lockheed Martin won the contract over another team led by Northrop Grumman and Boeing Co. The deal extends through 2019 and is divided into three stages. The first phase is estimated to cost $3.9 billion; the second, $3.5 billion; and the final stage, $750 million.
Orion, also known as the Crew Exploration Vehicle, or CEV, will be able to hold six passengers for flights to the International Space Station and four astronauts for the moon and Mars missions.
"We are delighted and honored to be a part of the NASA team," said John C. Karas, vice president of human spaceflight for Lockheed Martin. The team of subcontractors assembled by Lockheed Martin includes United Space Alliance, Honeywell, Hamilton Sundstrand and Orbital.
NASA centers nationwide, including the Kennedy Space Center, will have a role in the project.
The final assembly of Orion will take place at the Kennedy center. That translates into 300 new jobs for central Florida devoted to the Orion project, Lockheed Martin officials said.
Those jobs will help replace hundreds of positions expected to be lost when the space shuttle is retired from service in 2010.
Yesterday's announcement marks another milestone for NASA in its ambitious plan to return astronauts to the moon and visit Mars. The last time the space agency landed on the moon was in 1972, near the end of the Apollo program. NASA has been limited to low-Earth orbit in the three decades since.
The shuttle fleet has four years remaining before its planned retirement. The current schedule calls for the first manned flight of the Orion spacecraft by 2014.
Lockheed Martin will face pressure to help close that gap so the U.S. doesn't go four years without a ship that can carry people to orbit. After the announcement, Karas said the company aims to restart manned space flights before the 2014 deadline.
Like the shuttle, Orion's first job will be to ferry astronauts back and forth from the International Space Station. Then, larger and more advanced versions of the spacecraft are supposed to take crews to the moon by 2020 and eventually on to Mars.
To develop the spacecraft on schedule and within budget, NASA and Lockheed Martin will have their work cut out for them. A July study by the Government Accountability Office questioned NASA's ability to get Orion built.
"NASA has had difficulty bringing a number of projects to completion, including several efforts to build a second generation of reusable human spaceflight vehicle to replace the space shuttle," said the report, which named a long line of failed "expensive endeavors" such as the X-33 and X-34, experimental vehicles abandoned after costing NASA more than $1 billion.
Because of these setbacks, the GAO chastised the space agency for awarding a long-term contract for the Orion project before it had a better grasp of the time, technology and money needed to complete the project.
"This approach increases the risk that the project will encounter significant cost overruns, schedule delays and decreased capability," says the GAO, Congress' investigative agency.
NASA disagreed. In letter dated July 6, the agency rebutted the GAO, saying it already had the know-how to choose the right company.
One surprise left out of the news conference was the Orion name, which was supposed to remain a secret until the announcement. But its name was revealed accidentally last month when an astronaut from the International Space Station let slip the namesake during a transmission to Earth.
Mark Matthews writes for the Orlando Sentinel. Sentinel space editor Michael Cabbage contributed to this article.