Washington — The U.S. Department of War has finalized a $439.4 million production contract with Lockheed Martin to supply MGM-140 Army Tactical Missile System (ATACMS) short-range ballistic missiles to Taiwan under the Foreign Military Sales (FMS) program.
The agreement is fully funded at the time of signing, allowing production to proceed immediately without waiting for additional budget approvals. The missiles and related operational equipment will be delivered to Taiwan through February 28, 2031.
Although the initial production contract is valued at $439.4 million, U.S. financial documents indicate the overall acquisition value for the ATACMS guided missiles and launch assemblies is expected to reach approximately $896.7 million.
The contract is being managed by the U.S. Army Contracting Command at Redstone Arsenal, Alabama. The initial payment was made using Foreign Military Sales funds designated for Taiwan, the U.S. government program that enables allied and partner nations to purchase American-made defense equipment under Washington's oversight. Under this arrangement, Taiwan is funding the acquisition.
ATACMS to Equip Taiwan's HIMARS Fleet
The missiles are intended for use with the M142 High Mobility Artillery Rocket System (HIMARS) launchers that Taiwan has been receiving from the United States since October 2024.
ATACMS is a precision-guided short-range ballistic missile capable of striking targets at distances of up to 300 kilometers. It is designed to engage high-value military targets such as command centers, air defense systems, logistics hubs, and other critical military infrastructure. The missile is launched directly from the mobile HIMARS platform, allowing rapid deployment and repositioning.
Despite releasing the contract's financial details and delivery schedule, U.S. officials have not disclosed how many ATACMS missiles Taiwan will receive. The Department of War and the State Department have followed their usual practice of withholding missile quantities in Taiwan-related arms sales for operational security reasons.
Part of a Larger Taiwan Weapons Package
The production contract follows a broader U.S. arms package approved in December 2025, when the Trump administration authorized what was described as the largest U.S. weapons sale to Taiwan, valued at more than $11 billion.
That package included 420 M57 ATACMS missiles, including newer longer-range variants, 82 additional HIMARS launchers, and more than 1,200 precision-guided rockets. The approval significantly expanded Taiwan's planned long-range strike capability.
The earlier phase of Taiwan's HIMARS program included 29 HIMARS launchers and hundreds of guided rockets. Much of that equipment has already been delivered, providing Taiwan with an operational HIMARS capability that will be expanded further through the new ATACMS production contract.
Taiwan Continues Defense Modernization
Taiwan has continued to modernize its armed forces through investments in missile systems, artillery, and other defense equipment. Officials in Taipei have described these acquisitions as part of a broader effort to strengthen the island's defensive capabilities.
The combination of HIMARS launchers and ATACMS missiles provides Taiwan with a mobile, precision long-range strike capability that can engage military targets at significant distances while allowing launchers to relocate quickly after firing.
Regional Security Environment
The contract comes amid continued military tensions across the Taiwan Strait. Beijing considers Taiwan a breakaway province and has repeatedly opposed U.S. arms sales to the island.
At the end of December 2025, the People's Liberation Army (PLA) conducted large-scale military exercises around Taiwan. During the drills, Chinese state broadcaster CCTV aired footage highlighting Taiwan's HIMARS launchers during a simulated strike scenario.
According to Taiwan's Central News Agency, military analysts said Beijing views Taiwan's expanding HIMARS and ATACMS inventory as a significant capability because the missiles could conduct precision strikes against military infrastructure, including rocket force positions and logistics facilities. Researchers from Taiwan's Institute for National Defense and Security Research also noted that ATACMS launched from Taiwan's outlying islands could reach much of China's Fujian Province.
Deliveries Scheduled Through 2031
With funding already committed and the production contract now finalized, Lockheed Martin will manufacture the missiles in the United States, with most production work taking place in Texas. Deliveries of the missiles and associated equipment are scheduled to continue until February 28, 2031.
The agreement represents another step in ongoing U.S.-Taiwan defense cooperation and will further expand Taiwan's long-range precision strike capability as it continues integrating new HIMARS launchers and supporting missile systems into its armed forces.
Source : war.gov
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