On Wednesday, July 28, 2026, US company Lockheed Martin announced that it had finalized a seven-year framework agreement concluded with the US Department of Defense on January 6 through a 53.86 billion USD contract modification for the production of PAC-3 (Patriot Advanced Capability-3) interceptor missiles for the MIM-104 Patriot air and missile defense system. Together with the 4.761 billion USD modification awarded on April 9, this brings the cumulative value of the agreement to 58.62 billion USD.
Photo: Lockheed Martin
The January framework agreement provides for increasing large-scale production of PAC-3 MSE missiles from the current level of approximately 600 to 2,000 units annually. Accordingly, on April 1 this year, Boeing also signed an agreement to triple production of seekers for these missiles, while on July 27 L3Harris Technologies received an order to increase production of the advanced two-pulse solid rocket motor, the Attitude Control Motors (ACMs) forming part of the Attitude Control Section (ACS), and the Lethality Enhancer. Wojskowe Zakłady Elektroniczne will serve as a subcontractor for the ACM and ACS components, as announced on May 26.
According to Lockheed Martin’s press release, the new funding will enable the company to triple PAC-3 MSE production by the end of 2030 and increase employment at its Camden, Arkansas, facilities by 50%, from 1,200 to approximately 1,850 employees. Final assembly of the missiles takes place at the Camden site.
“Today’s announcement turns concept into reality, providing industry with the long-term demand signals it needs to build a resilient supply chain, scale production, and deliver critical capabilities to our Warfighters at the speed of relevance,” said Michael P. Duffey, Under Secretary of War for Acquisition and Sustainment.
“This is a once-in-a-generation moment, and we are moving with wartime urgency to deliver the Arsenal of Freedom,” said Lockheed Martin Chairman, President and CEO Jim Taiclet. “Lockheed Martin is sparing no effort with our investment, hiring and facility upgrades as we deliver on the government’s acquisition transformation.”
This agreement is Lockheed Martin’s second major multiyear contract under the US Department of Defense’s new acquisition model, following the seven-year framework agreement signed with the Missile Defense Agency (MDA) on June 24, 2026, with a maximum value of 35,327,237,604 USD, for the production of interceptor missiles for the advanced Terminal High Altitude Area Defense (THAAD) system.
Lockheed Martin will invest between 8 billion USD and 9 billion USD through 2030 to modernize more than 20 facilities in the United States and rapidly increase munitions production. The company has already marked two major milestones at its munitions plants this year. On May 21, it broke ground on the new Building 47 at the Munitions Production Center in Troy, Alabama, which will support the THAAD program and the Next-Generation Interceptor (NGI).
PAC-3 MSE
PAC-3 MSE missiles, developed from the Cost Reduction Initiative (CRI) variant, were designed to enhance the MIM-104 Patriot system’s ability to intercept ballistic missiles. As part of the program, they received more powerful rocket motors, while their performance, including interception range and altitude, was also improved. PAC-3 MSE missiles can also engage maneuvering targets such as cruise missiles and crewed and uncrewed aircraft. They do not carry a conventional explosive warhead, instead destroying targets through kinetic energy using the hit-to-kill principle.
Further major orders for PAC-3 MSE production are particularly important for Poland, not only as a user of the system but also as a supplier. Companies belonging to the Polish Armaments Group (PGZ) are integrated into the program’s supply chain, including the aforementioned Wojskowe Zakłady Elektroniczne, as well as Wojskowe Zakłady Lotnicze No. 1 and Wojskowe Zakłady Uzbrojenia.
.@LockheedMartin and @DeptofWar signed a seven‑year contract for PAC‑3® MSE production, bringing the multiyear total value to $58.62B. This triples production by 2030, meeting the nation’s missile demand and strengthening the Arsenal of Freedom. Click for more: ⬇️
— Lockheed Martin News (@LMNews) July 29, 2026
Long‑term commitment. Lasting impact.
We’ve reached a seven-year agreement with the @DeptofWar for PAC-3® MSE, bringing the total multi-year value to $58.62B. This is the next phase of production — expanding capacity at speed and powering the Arsenal of Freedom. pic.twitter.com/S9vJqXSNUe
— Lockheed Martin (@LockheedMartin) July 29, 2026
UPDATE
On July 30, the US Department of Defense published details of the contract awarded the previous day by the US Army Contracting Command (ACC) at Redstone Arsenal, Alabama:
The modification is valued at 53,859,843,289 USD, increasing the contract’s cumulative value to 58,620,843,289 USD. It covers the production of hardware and equipment, as well as the manufacturing activities required to produce PAC-3 MSE missiles. Work will be performed in Huntsville, Alabama; Camden, Arkansas; Hollister, California; Clearwater, Lake Mary, Ocala, and Pinellas Park, Florida; Wichita, Kansas; Chelmsford, Massachusetts; Lincoln, Nebraska; East Aurora, New York; Archbald, Pennsylvania; Grand Prairie and Lufkin, Texas; Vergennes, Vermont; and Rocket Center, West Virginia, with an estimated completion date of March 31, 2035. No funds were obligated at the time of the award.
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