Air Force awards Lockheed $3.2B multiyear missile contract

The Air Force on Friday awarded Lockheed Martin a $3.2 billion multiyear contract for air-to-ground and anti-ship missiles, as part of a Pentagon effort to maximize weapons production through multiyear procurements.

The sole-source contract is for AGM-158C Long Range Anti-Ship Missiles (LRASM) and AGM-158B Joint Air-to-Surface Standoff Missiles (JASSM) and will include foreign military sales to Japan, the Netherlands, Finland and Poland.

The Pentagon in 2023 proposed using multiyear procurement authorities — which are usually used for buying ships or aircraft — to buy munitions, which it hoped would allow industry to expand its production capacity. Defense officials said at the time this was intended to deter China and strengthen the U.S. defense industrial base, but arming Ukraine against its invasion by Russia has also taxed U.S. weapons stockpiles.

The plan included a strategy called a large lot procurement pilot program. This contract will allow Lockheed to increase the number of JASSMs and LRASMs it can produce each year, Lockheed said in a statement

“Multi-year procurements of critical munition systems like JASSM and LRASM are a key anti-fragility measure to increase industry resilience and ensure operations can be ramped more quickly going forward,” Lockheed said.

Lockheed will build the missiles in Orlando, Florida, and is expected to finish the work by the end of July 2032. The Air Force is providing $1.5 billion in missile procurement funds and $2 million in operations and maintenance funds at the time of the award, and the Navy is providing $176 million in its own weapon procurement funds. The Pentagon is also obligating another $752 million of FMS funds for the contract.

The JASSM is a cruise missile designed to allow aircraft to strike ground targets while keeping a safe distance away from enemy air defenses or other hostile aircraft. The LRASM, based on the JASSM’s design, is intended to penetrate enemy air defense targets to take out ships from standoff range.

Also on Friday, the State Department approved a possible $405 million sale of up to 100 Advanced Anti-Radiation Guided Missiles-Extended Range and related equipment to Australia. Selling these missiles to Australia, a key ally in the Pacific, would help support the U.S.’s foreign policy and national security objectives, the State Department said.

Australia would be able to suppress or destroy land- or sea-based radars used by enemy air defenses with those Northrop Grumman-made missiles and improve allied aircraft’s ability to survive a conflict, according to the State Department.