Department of War Awards $20.7 Billion Missile Contract
The five-year deal with Raytheon aims to replenish military stockpiles and support an annual production of 1,900 AMRAAMs.
Updated on Oct. 24, 2026 in Military
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The Department of War has awarded a $20.7 billion contract to Raytheon for the production of Advanced Medium Range Air-to-Air Missiles. This initiative is designed to replenish defense stockpiles depleted by international conflicts and ongoing support to Ukraine.
Why it matters
The contract is part of the Arsenal of Freedom initiative to bolster national defense capabilities through multi-year agreements. By scaling up manufacturing, the Department of War aims to secure a steady supply of precision weaponry amidst heightened global demand.
The five-year contract features an approximate cost of $1 million per AMRAAM. This deal is expected to create 3,000 new aerospace manufacturing jobs using facilities in Tucson and across the country.
The players
Raytheon
An American aerospace and defense conglomerate that serves as a primary contractor for military missile systems.
Lockheed Martin
A global security and aerospace company known for producing advanced defense platforms like the Patriot missile system.
Department of War
The federal agency responsible for the coordination and management of all agencies and functions of the government relating directly to national security.
The details
Raytheon, which doubled its AMRAAM production between 2024 and 2025, plans to reach an annual output target of 1,900 units starting in 2027. The agreement includes two additional option years, meaning production could potentially extend through 2033.
Timeline
2024: Raytheon begins increasing production capacity.
2025: Production ramp-up concludes.
June 2026: Lockheed Martin receives a $53 billion missile contract.
October 24, 2026: The Department of War awards the $20.7 billion contract to Raytheon.
2027: The annual target of 1,900 AMRAAMs begins.
Political Context
Opponents of these large-scale defense contracts often argue that the Arsenal of Freedom initiative prioritizes corporate consolidation over competitive bidding processes. Fiscal hawks frequently raise concerns regarding the long-term budgetary strain caused by multi-year, multi-billion dollar procurement commitments.
While the deal focuses on defense procurement, the addition of 3,000 aerospace jobs provides a boost to the manufacturing sector's labor market. Taxpayers should note that these multi-year contract values represent significant long-term commitments of national funds toward defense infrastructure.
The takeaway
The move highlights the federal government's shift toward long-term manufacturing agreements to ensure weapon availability. Readers should anticipate sustained production activity in defense hubs as the military works to normalize its inventory levels.
Further reading
For broader updates on defense procurement and national security strategy, visit the United States Military section.
Source note: This article includes information reported by Arizona Public Media.
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