On Tuesday, October 14, 2025, the American company Lockheed Martin announced that it had signed a Memorandum of Understanding (MoU) with Germany’s Diehl Defence regarding its inclusion in the global supply chain for the PAC-3 (Patriot Advanced Capability-3) MSE (Missile Segment Enhancement) interceptor missile program.
Photo: Lockheed Martin
Under the agreement, the two companies will explore opportunities related to the U.S. Integrated Air and Missile Defense (IAMD) program, particularly in strengthening the PAC-3 MSE program, as well as in research and development and other related activities.
“Recent real-world performance has increased the demand for PAC-3 MSE for America and allied nations. To meet this growing demand, Lockheed Martin is surging production to accelerate the delivery of this critical defense capability to our global customers,” said Jason Reynolds, vice president of IAMD at Lockheed Martin. “By deepening our collaboration with industry leaders like Diehl Defence, we can ensure a more resilient and responsive supply chain that supports allied defense.”
“The rapidly changing security situation is posing new demands to defence industries. To further strengthen the capabilities of the alliance and our international customers is our mission. Diehl Defence and Lockheed Martin share aligned core competencies, complementary capabilities, and common expertise in this mission area,” commented Torsten Cook, Senior Vice President of GBAD at Diehl Defence. “Cohesion and resilience need also to be reflected by the defence industries.”
Lockheed Martin has been a partner of the German industry for more than 50 years and continues to expand those partnerships through cooperation with leading innovative companies such as Diehl Defence.
On 3 September this year the U.S. Army placed a record order with Lockheed Martin under the IAMD program — a framework agreement with a maximum value of 9.8 billion USD for the delivery of 1,970 PAC-3 MSE interceptors for the MIM-104 Patriot air and missile defense systems. Meanwhile, also on 14 October this year, Boeing received a multi-year contract from Lockheed Martin to produce over 3,000 guidance sections for PAC-3 family missiles for approximately 2.7 billion USD.
Lockheed Martin is continuing to ramp up PAC-3 production to meet growing demand. The company is scheduled to deliver more than 600 missiles in 2025 for the first time. Companies of the Polish Armaments Group (Polska Grupa Zbrojeniowa, PGZ) are integrated into the PAC-3 MSE supply chains: Wojskowe Zakłady Elektroniczne, Wojskowe Zakłady Lotnicze Nr 1, and Wojskowe Zakłady Uzbrojenia.
The PAC-3 MSE missiles, developed as an enhancement of the CRI (Cost Reduction Initiative), were designed to increase the MIM-104 Patriot system’s capability to intercept ballistic missiles. The project equipped them with more powerful rocket motors and improved performance characteristics such as range and interception altitude. PAC-3 MSE missiles can be used to destroy maneuvering targets, such as cruise missiles, as well as crewed and uncrewed aircraft. They do not carry a conventional explosive warhead; targets are destroyed by kinetic energy (hit-to-kill).
For Diehl Defence, the agreement with Lockheed Martin is the second deal with the U.S. defense industry to enter air-defence supply chains. On 19 August this year it signed a Letter of Intent (LoI) with Raytheon (part of RTX corporation) on cooperation to manufacture key components for the portable FIM-92 Stinger surface-to-air missile systems.
.@LockheedMartin and @DiehlDefence deepen European collaboration at #AUSA2025. An MOU was signed to explore expanding the PAC‑3 MSE global supply chain – ensuring a more resilient and responsive supply chain that supports defense worldwide. 🇩🇪 pic.twitter.com/P8haSqpeFV
— Lockheed Martin Europe (@LMEuropeNews) October 15, 2025