The Pentagon and Lockheed Martin are moving swiftly to ramp up production of a new, classified air-to-air missile intended for use on U.S. Air Force and Navy fighter jets. The company and the U.S. Department of Defense have announced a broad framework agreement that will eventually lead to a multi-year production contract for the Joint Advanced Tactical Missile, or JATM.
The missile is still under development but is nearing the production phase. Once deployed, it is set to become the most advanced air-to-air missile in the U.S. arsenal, a position long held by Raytheon Technologies' evolving AIM-120 Advanced Medium-Range Air-to-Air Missile series, which first entered service in 1993.
The Pentagon said in a statement on Thursday that this agreement is vital for ensuring Lockheed Martin and the ammunition supply chain can make long-term workforce and production capacity investments. Tim Cahill, president of Lockheed Martin's Missiles and Fire Control division, stated that the company will deliver the JATM at the speed required by the nation and its allies, while providing value for taxpayers and shareholders.
This marks the first framework agreement for a classified system led by Michael Duffey, the Pentagon's top acquisition official. His office has already completed framework agreements for several high-profile systems, including the most advanced versions of the Patriot surface-to-air missile, the Tomahawk cruise missile, and interceptors for the Terminal High-Altitude Area Defense system.
The new missile project received an additional $2 billion in the Trump administration's budget proposal for the fiscal year beginning October 1, signaling a potential acceleration in production and near-term deployment. Both the Air Force and Navy are seeking $2.9 billion for the missile's development and orders in 2027, a sharp increase from the $894 million allocated this fiscal year.
A recent report from Guggenheim suggested that defense spending is likely to continue into the next decade, supported by geopolitical threats, weapons stockpile replenishment, and military modernization efforts, meaning that any pullback in defense stocks could present a buying opportunity.
Lockheed Martin initially received the classified development contract in August 2017. In March, the Pentagon also disclosed plans to sell 460 missiles and test equipment to Australia for $3.1 billion. The new JATM, also known as the AIM-260, is designed to fit into the internal weapons bays of F-22 and F-35 fighters, though the Air Force has noted it can also be integrated onto F-16 and F-15 aircraft. In premarket trading on Thursday, shares of both Lockheed Martin and Raytheon Technologies edged up nearly 1%.
Comments