May 24, 2024

Lockheed wins $17 billion US missile defense contract, sources say

Lockheed Martin has won a $17 billion contract to develop next-generation interceptors to protect the United States from intercontinental ballistic missile attacks, two sources familiar with the matter told Reuters.

The order is a big win for Lockheed after the U.S. announced it was cutting its F-35 orders, and in February the military submitted a draft of the next-generation helicopter to Lockheed, which said it was building a future attack spy plane. up to

A multi-year contract will be awarded on Monday by the US Missile Defense Agency, which is developing the Next Generation Interceptor (NGI) to modernize the current land-based midcourse defense program. It is a network of radars, anti-ballistic missiles, and other devices designed to protect the United States from intercontinental ballistic missiles.

Both Lockheed and the Missile Defense Agency declined to comment. The sources did not specify the duration of the contract, but the first interceptor is expected to be operational in 2028.

NGI is currently in the technology development phase and will move into the product development phase in May. This is according to a written statement issued last week by the head of the Missile Defense Agency, Lt. Gen. Heath Collins.

Collins said the agency will choose either Lockheed or Northrop Grumman for the project. The two companies received separate contracts in 2021 to develop designs for the rocket.

In 2019, the Pentagon halted work on a contract with Boeing to develop a “kill vehicle,” an interceptor's tip that would detach in space and “kill” an incoming warhead, due to technical design issues after it was released, 1. Spending $2 billion on the project.

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The US decided to reopen the contracting process to solicit bids for the development of the entire interceptor, including the “kill vehicle”. Boeing was kicked out of the competition in 2021.

The next-generation interceptor program will cost about $17.7 billion over its lifetime, according to government estimates, as the contractor works to design technology to counter current ballistic missile threats and future technological advances by countries such as North Korea and Iran. .

In January, Lockheed forecast 2024 profit below Wall Street expectations as the largest aerospace division, which makes F-35 jets, struggles with supply chain issues.

Lockheed will cut 1% of its jobs in 2024, according to Reuters.

US defense firms have benefited from strong demand for weapons over the past two years due to heightened geopolitical tensions. Sales of US military equipment to foreign governments will rise 16% to $238 billion in 2023. (Reporting by Mike Stone in Washington; Editing by Abhijith Ganabavaram; Editing by Chris Sanders and Leslie Adler)