US inks $3 billion-plus deals to accelerate Patriot, THAAD interceptor production

Northrop Grumman has signed two multi-year framework agreements worth more than $3 billion with the U.S. Department of War and Lockheed Martin to expand production of key missile defence components for the Patriot and THAAD systems, the company said on August 3.

According to Northrop Grumman, the agreements are aimed at increasing manufacturing capacity and speeding up deliveries to support the United States and its allies amid rising global demand for air and missile defence systems.

The larger, $2 billion agreement covers production of components for the Patriot Advanced Capability-3 Missile Segment Enhancement (PAC-3 MSE) interceptor, including solid rocket motors and ignition safety devices. The company said the deal is intended to help meet growing demand for the system.

A separate $1 billion framework agreement will allow Northrop Grumman to significantly increase monthly deliveries of components for the Terminal High Altitude Area Defence (THAAD) system over the next seven years.

The company said it has been expanding production capacity at several U.S. facilities through investments made since 2021. These include doubling solid rocket motor output at its Utah sites, nearly tripling capacity at the Allegany Ballistics Laboratory in West Virginia, and increasing production capacity by 25% at its Elkton, Maryland, facility.

Northrop Grumman said the investments are expected to support a planned increase in annual PAC-3 MSE missile production from about 600 units currently to several thousand in the coming years for U.S. forces and allied partners.

"Our long-term investments in breakthrough manufacturing technologies and resilient supply chains let us pivot from steady production to a production surge in record time," Ben Davies, the company's corporate vice president, said in a statement. He added that the expansion would support the administration's efforts to accelerate munitions production and strengthen U.S. missile defence capabilities.

Northrop Grumman said it has supplied components for the THAAD interceptor since 2002 and has invested more than $2 billion in munitions-related technologies and facilities since 2019, including more than $1 billion dedicated to solid rocket motor production.

The company, one of the largest U.S. defence contractors, employs nearly 100,000 people and manufactures a wide range of aerospace, missile defence and propulsion systems for the U.S. military and allied nations.

By Aghakazim Guliyev