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Lockheed Martin gets $4 billion contract for missile defense

Lockheed Martin gets $4 billion contract for missile defense


Lockheed Martin gets $4 billion contract for missile defense

Lockheed Martin gets $4 billion contract for missile defenseThe Pentagon has announced that it has finalized a $4 billion contract with Lockheed Martin Corp that will involving supplying missile defense equipment to the United States and the United Arab Emirates.

Reports indicate that the contract involves Lockheed’s Terminal High Altitude Area Defense (THAAD) missile defense system. The system is designed as a way to intercept ballistic missiles while they are midair, the Pentagon’s daily digest of weapons contracts indicates. THAAD was originally designed to hit Scuds and similar weapons. It can shoot down short, medium and intermediate ballistic missiles but has limited capability against ICBMs.

One THAAD system costs $800 million. The program was originally for the U.S. Army, having fallen under the Missile Defense Agency umbrella. The THAAD concept was proposed in 1987, and formal requests were submitted in 1990. Lockheed Martin was selected as the prime contractor for THAAD development for the U.S. Army in 1992. The first THAAD flight test was in 1995 at White Sands Missile Range with the first six intercepts missing target. In 1999, the first successful intercepts were conducted against Hera missiles.

This particular deal has taken several years to negotiate. It is believed that the combined orders for the United States and the United Arab Emirates will result in the U.S. saving about 10 percent, according to statements from Mat Joyce, the THAAD program manager and Lockheed vice president.

The contract includes 192 interceptors for the UAE and as many as 110 of the interceptors for the U.S. Army. There is an additional option for fiscal year 2014 with a $352 million value, and it would have to be enacted no later than Dec. 31, the announcement from the Pentagon indicates.

Reports have indicated that the U.S. is in discussion with Qatar on the possible sale of the THAAD missile defense system. Interest has also been shown by Saudi Arabia, Japan and South Korea. The first operational test of THAAD and its ability to work with the Aegis combat system while on a guided-missile destroyer was conducted by the U.S. Missile Defense Agency last week, reports indicate. The two systems, while working together, intercepted two medium-range ballistic missiles which had been fired almost simultaneously.

Earlier in the year, when North Korea threated the U.S. with a nuclear attack, the Pentagon sent two Aegis destroyers out to the western Pacific while placing a THAAD missile system on the Pacific territory of Guam.

About Stephany Wilson

Stephany Wilson covers business and finance related news.

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