On Thursday, the Pentagon announced a $24.4 billion contract awarded to Raytheon to speed up the production of SM‑6 missiles, a key anti‑air and anti‑surface munition. The deal spans five years, with two additional option years, and will see the company expand tooling and workforce capacity at its Alabama and New Mexico facilities.
The contract comes as the United States faces a strategic inventory shortfall stemming from the 2023 Iran‑Israel conflict, known officially as Operation Epic Fury. In a report last month, the Department of Defense Inspector General, Gen. John R. Smith, warned that the munitions expenditure had exposed bottlenecks in the industrial base.
The Pentagon’s move follows the Congressional Budget Office’s September 15 assessment that U.S. missile defense supplies will be reduced for several years if production does not catch up. “This contract is a critical step toward restoring our interceptor stockpile,” said Defense Secretary Lloyd Austin in a statement.
At the Raytheon plant in Tuscaloosa, 250 workers will receive specialized training in SM‑6 assembly, and the company plans to add 30 new positions by the end of 2027. Local contractors say the expansion could boost the town’s economy by up to ₹1.2 billion over the next five years.
The contract is already under congressional scrutiny, and Raytheon is expected to begin ramping production in July, with a full rollout of the new lines by January 2028. The next phase will involve a joint review with the Defense Production Act to ensure supply chain resilience.