Lockheed Martin on Friday was awarded a $5.3 billion multi-year contract for PAC-3 missile interceptors, the Pentagon announced.
The deal includes Army and Foreign Military Sale procurement funds, with the service noting its award includes $4.5 billion for 870 PAC-3 MSE missiles.
“This multi-year contract award for the PAC-3 MSE missile follows through on the Army’s commitment to stabilize and expand our production capability for this critical weapon system, which is vital to supporting the US Army and Joint Force, along with Ukraine and other allies around the world” Doug Bush, the Army’s acquisition chief, said in a statement.
Work on the deal is expected to be completed by the end of June 2027.
The PAC-3 interceptor is usually fired from U.S. Army Patriot air and missile defense systems
After Congress granted new authority in the fiscal year 2023 defense policy bill to seek multi-year procurement opportunities for select munitions, the final FY ‘24 defense appropriations bill funded six of DoD’s seven requests to include PAC-3 MSEs as well as Lockheed Martin’s GMLRS, LRASM and JASSM-ER missiles Kongsberg’s Naval Strike Missile and RTX’s [RTX] AMRAAM missiles (Defense Daily, March 21).
“Multi-year contracts are mutually beneficial to the United States government and our industry partners,” said Brig. Gen. Frank Lozano, the Army’s program executive officer for missiles and space, said in a statement. “They strive to lower procurement costs by allowing bulk purchasing and reducing administrative strain and costs associated with annual contract renewals, while also providing our suppliers with a stable demand forecast, encouraging investment in production capacity and capability improvements.”
The final FY ‘24 defense spending bill did not cover DoD’s request to use multi-year authority for RTX’s SM-6 missiles.
The FY ‘24 National Defense Authorization Act further expanded the list of weapons eligible for such contracts to include: Tomahawk cruise missiles, the Army’s new Precision Strike Missiles, Mark 48 Torpedoes, Evolved Sea Sparrow Missiles, Rolling Airframe Missiles, and Small Diameter Bombs (Defense Daily, Dec. 14 2023).
The Pentagon, however, did not include any new requests for multi-year munitions procurements in its FY ‘25 budget submission (Defense Daily, March 14).
The White House confirmed last week it would prioritize sending air defense interceptors, including PAC-3 missiles, to Ukraine that were intended for delivery to other countries under Foreign Military Sales cases (Defense Daily, June 20).
John Kirby, spokesman for the National Security Council, told reporters the decision arrives as Ukraine “urgently needs” additional air defense capabilities as it has faced an “accelerated” number of Russian missile and drone attacks on infrastructure in recent months.