Lockheed Martin strikes $35B deal to restock depleted THAAD interceptor stockpile

Defense Lockheed Martin strikes $35B deal to restock depleted THAAD interceptor stockpile Comments: by Ellen Mitchell - 06/25/26 1:01 PM ET Comments: Link copied by Ellen Mitchell - 06/25/26 1:01 PM ET Comments: Link copied

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The Pentagon has awarded Lockheed Martin a seven-year contract worth up to $35 billion to churn out hundreds of Terminal High Altitude Area Defense (THAAD) interceptors a year, in an effort to replenish dwindling U.S. munitions stockpiles.

Announced Wednesday, the award means Lockheed will receive an initial $842.9 million, according to the Missile Defense Agency (MDA). Used in the Iran war, THAAD interceptors are capable of neutralizing ballistic missiles outside the Earth’s atmosphere and can cost more than $12 million each to produce.

The deal comes the same day President Trump met with the CEOs of Lockheed, Boeing and Honeywell at the White House, a gathering intended to push defense contractors to speed up weapons production after many of Washington’s highly sophisticated missiles and interceptors were depleted in the Iran war.

The contract also follows a $4.7 billion deal with Lockheed in April to speed up production of Patriot missiles. Both contracts are “undefinitized,” however, meaning they can’t be fully funded until Congress approves them. Only then will Lockheed receive a final agreement.

MDA in the same notice said it awarded Raytheon a $398.7 million contract for Advanced Medium Range Air-to-Air Missiles.

The Trump administration since last year has been pressing defense firms to significantly increase their missile output by investing in their factories and operations after warnings that U.S. munitions stockpiles are dangerously low. Those types of weapons, including THAAD and Patriot interceptors and Tomahawk cruise missiles, have been used to shoot down Iranian drones and missiles in the war.

Lockheed has responded with a new factory in Alabama to support THAAD production, which broke ground in May.

“Lockheed Martin’s more than $9 billion investment through 2030 is already delivering tangible results to meet heightened munitions demand, including this new facility along with more than 20 others across the United States,” the company said in a statement at the time.

Manufacturers, in return, have been promised larger, multiyear contracts in order to keep factory lines moving.

Trump last met with major defense contractors on March 6, after which he declared they had agreed to quadruple the production of “exquisite class” weaponry.

And earlier this month the president invoked the Defense Production Act to speed up weapons production in response to “systemic constraints in the munitions industrial base, including limited production capacity, fragile supply chains, long-lead dependencies, and related production bottlenecks.”

The Lockheed deal also comes as the White House has asked Congress for $87.6 billion in supplemental funding to pay for the Iran war and other requests, with $21 billion of that meant for munitions.

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