Lockheed Martin [LMT] has more than $3.5 billion worth of business it has captured in hypersonic weapons, with a lot of the development work expected to move into the prototype phase in 2019 with potential production decisions about two years away, company executives said last week.

The hypersonic contracts, which include work from all the military services and the Defense Advanced Research Projects Agency, are either in backlog or about to go into backlog, Ken Possenriede, Lockheed Martin’s chief financial officer, said July 23 during the company’s second quarter earnings call.

Artist rendering of scramjet-powered hypersonic tactical missile being developed by Raytheon and Northrop Grumman. (Rendering by Northrop Grumman and Raytheon)
Artist rendering of scramjet-powered hypersonic tactical missile being developed by Raytheon and Northrop Grumman. (Rendering by Northrop Grumman and Raytheon)

Just because the programs will include prototypes doesn’t mean they’ll transition to production but if development and prototyping is “deemed successful … then I think it will be time for the customer set to sit with us to see if it makes sense to go into production and that’s probably, say two years out would be our best guess,” he said.

Lockheed Martin expects to generate about $600 million in sales this year from hypersonic work, Possenriede said.

Lockheed Martin Chairman, President and CEO Marillyn Hewson outlined some of the company’s hypersonic wins in the second quarter, including selection as the prime contractor for the integration of an Army long-range hypersonic weapon system and as part of a team led by

Dynetics for an Army common hypersonic glide body prototype. She says the company’s contracts for these two programs will be negotiated and finalized in the coming months.

She also highlighted previous wins for hypersonic work, including a prototyping effort for the Air Force called the Hypersonic Conventional Strike Weapon (HCSW) and the Navy’s intermediate-range Conventional Prompt Strike Weapon.

In June, the Air Force conducted the first captive carry flight test of its hypersonic Air-launched Rapid Response Weapon (ARRW) aboard a B-52 bomber, Hewson said. The ARRW weapon passed its preliminary design review in March “and this captive carry test is the most recent step in the Air Force’s rapid prototyping strategy to mature this hypersonic weapon,” she said.

The development of hypersonic capabilities, both offensive and counter-hypersonic, is the top priority of Pentagon Research and Development Chief Michael Griffin.

Thomas Kennedy, Raytheon’s [RTN] chairman and CEO, said July 25 on his company’s earnings call that it believes the counter-hypersonic “market is actually larger than the hypersonic market for multiple reasons. One is that not does it include hypersonic weapons to counter the hypersonic weapons, but it also includes the entire kill chain of communications and sensors.”

Raytheon is developing both hypersonic and counter-hypersonic systems, “and also the entire integrated counter-hypersonic kill chain, including the sensors,” Kennedy said.

Some of the work on both types of systems is classified, he said.

Unclassified work that Raytheon is involved in includes the Hypersonic Air-breathing Weapon Concept (HAWC) for DARPA and the Air Force. At the Paris Air Show in June, Raytheon and Northrop Grumman [NOC] announced they are teaming on the development, production and integration of Northrop Grumman’s scramjet engine to power the HAWC and future air-breathing hypersonic missiles.

Raytheon is also working on the DARPA/Air Force Tactical Boost Glide, the Conventional Prompt Strike Weapon, and the Army’s long-range hypersonic weapons programs, Kennedy said.

“So, it is becoming a big part of our portfolio moving forward,” he said of hypersonic work.

Raytheon expects to generate about $300 million in sales this year from its hypersonic work in the Missile Systems segment, Anthony “Toby” O’Brien, Raytheon’s chief financial officer, said on the call. He added that Raytheon’s hypersonic work cuts across the entire company.

O’Brien did not disclose how much hypersonic work the missile business has in backlog but said it grew in the second quarter versus the first quarter “and would expect that to continue, certainly for the next 12 to 18 months.”

The reason that hypersonic work is part of all four of Raytheon’s core segments is because counter-hypersonic “requires a solution for the entire fire control chain to be able to detect the threat and then make your decision on what you’re going to do with that threat, and then track that threat all the way through its flight patch and then interdict somehow to destroy that threat,” Kennedy said.

Raytheon’s pending acquisition by United Technologies Corp. [UTX] will also help in the development of hypersonic capabilities, Kennedy said. He pointed to UTC’s technology prowess in high-temperature materials for inlets and engine and “high-end sensors” that they have.

On Northrop Grumman’s July 24 earnings call, Kathy Warden, the company’s president and CEO, highlighted her company’s hypersonic work as a prime and subcontractor. In addition to supporting Raytheon on HAWC, the company supports Lockheed Martin on the Conventional Prompt Strike Weapon.

Northrop Grumman is “establishing ourselves as the prime” in the counter-hypersonic market, Warden said, pointing to capabilities it has in missile defense that it believes will be relevant.

“So that is an area we are aggressively pursuing,” she said.

Warden also said that the hypersonic market is “growing” and there is room enough for “three parties to adequately play,” referring to her company, Lockheed Martin and Raytheon.