DALLAS- Lockheed Martin has received a seven-year contract worth up to $35 billion from the U.S. government to quadruple production of Terminal High Altitude Area Defense (THAAD) interceptors.
The award, announced on June 24, 2026, ranks among the first major multiyear procurement deals signed under the Department of War’s Acquisition Transformation Strategy.
The contract activates a framework agreement reached in January 2026 between the Department of War and the defense firm. From its Dallas (DFW) operations, Lockheed Martin plans to scale capacity, strengthen the defense industrial base, and deliver missile defense capability for the United States and its allies at speed.
Lockheed Wins $35 Billion Contract from the US Govt
The agreement takes the form of a seven-year undefinitized contract action (UCA), a structure that lets production begin before final terms close.
It represents one of the first full transitions from a framework agreement to active contract execution under the Acquisition Transformation Strategy.
The January framework set the stage by giving Lockheed Martin a long-term demand signal. That signal allows the company to plan capacity, lock in supplier commitments, and invest ahead of orders. The new contract converts that planning into funded production, aiming to lift THAAD interceptor output to four times its earlier rate.
Major Facility Investments Back the Expansion
The award follows a wave of facility openings tied to a company investment of more than $9 billion through 2030. Weeks before the contract, Lockheed Martin broke ground on a new Munitions Production Center in Troy, Alabama.
That investment already supports more than 20 new or upgraded facilities across the United States. The company recently opened a Next Generation Interceptor facility in Courtland, Alabama, along with a Munitions Acceleration Center in Camden, Arkansas. Each site adds capacity to meet rising munitions demand.
Why THAAD Matters for Missile Defense
THAAD is the only U.S. system built to intercept threats both inside and outside the atmosphere. That dual capability gives commanders a critical layer of defense against a range of incoming missiles.
The system has proven its performance in operations such as Operation Epic Fury, where it continues to protect forces and key infrastructure against changing threats.
Executive Remarks
Tim Cahill, president of Lockheed Martin Missiles and Fire Control, framed the deal as a turn toward multiyear buying. “This award reflects our shared vision with the Department of War to strengthen America’s Arsenal of Freedom through a transformational shift to multiyear procurement,” he said.
He added that the new model speeds the company’s work to expand the defense industrial base, grow production, and deliver capability to the warfighter on a large scale.
Wider Acquisition Transformation Push
Lockheed Martin was the first in the industry to announce a framework agreement for munitions acceleration under the strategy.
Since January 2026, the company has set landmark agreements to expand the output of PAC-3 MSE, the THAAD interceptor, and the Precision Strike Missile (PrSM).
In April 2026, the U.S. government awarded Lockheed Martin a $4.7 billion contract to continue accelerated production of PAC-3 MSE this year. The THAAD award builds on that momentum across the company’s missile portfolio.
Jobs and Supply Chain Impact
The expansion supports tens of thousands of American jobs across manufacturing, engineering, and skilled trades. The company links these roles to a steady supply of proven defense capabilities for the United States and its allies.
Lockheed Martin is also working to strengthen supply chain resilience. The firm engages regularly with suppliers that are critical to scaling munitions production, with a focus on stronger relationships, faster delivery, and practical solutions for current and future threats.
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