Washington — The 2026 US–Iran conflict has exposed major challenges in America's missile stockpiles and defence-industrial capacity, pushing Washington to accelerate the production of Tomahawk cruise missiles, Patriot and THAAD interceptors, loitering munitions and counter-drone systems. The extensive use of precision weapons and air-defence interceptors has highlighted the importance of replacing weapons quickly during a prolonged, high-intensity conflict.
The United States is now pursuing a major expansion of its defence manufacturing industry involving RTX (Raytheon), Lockheed Martin, Northrop Grumman, L3Harris, Boeing and BAE Systems, alongside emerging defence manufacturers such as Anduril and AeroVironment.
Several of these programmes were already being developed before the conflict, but the war has strengthened the urgency of expanding production. In February 2026, the Pentagon established five major framework agreements with Raytheon to increase production of Tomahawk, AMRAAM, SM-3 and SM-6 missiles. Further multiyear contracts and manufacturing investments followed.
US Missile Production Expansion: Current and Planned Capacity
The Pentagon's production strategy focuses on increasing output of long-range cruise missiles, ballistic missile interceptors and precision-strike weapons.
The following table compares reported existing production capacity or historical procurement rates with announced future targets.
| Missile system | Current production baseline | Planned annual capacity |
|---|---|---|
| Tomahawk | 79 average annual procurement over five years | 1,000+ |
| PAC-3 MSE | Approximately 600 capacity | 2,000 |
| THAAD | 96 | 400 |
| SM-6 | 96 average annual procurement over five years | 500+ |
| AMRAAM | Nearly doubled in 2025 compared with 2024 | 1,900 |
| PrSM | Exact baseline undisclosed | Approximately 550 |
| SM-3 Block IB | Exact baseline undisclosed | Production expansion |
| SM-3 Block IIA | Exact baseline undisclosed | Production expansion |
Note: Historical procurement averages are not necessarily identical to factory production capacity. The targets are planned annual capacities, not confirmed deliveries.
RTX has announced that Tomahawk production will exceed 1,000 annually, while PAC-3 MSE and THAAD targets are based on Lockheed Martin's expansion commitments.
RTX and Raytheon Lead the Tomahawk and Naval Missile Expansion
RTX's Raytheon business is among the biggest beneficiaries of the Pentagon's munitions expansion.
On February 4, 2026, Raytheon announced five framework agreements with the US Department of War covering Tomahawk, AMRAAM, SM-3 Block IB, SM-3 Block IIA and SM-6 missiles.
The company plans to increase annual production of Tomahawks to more than 1,000, AMRAAMs to at least 1,900 and SM-6 missiles to more than 500.
Major Raytheon contracts
| Missile | Contract value | Contract duration |
|---|---|---|
| Tomahawk | $22.9 billion | 7 years |
| SM-6 | Up to $24.4 billion | 5 years + 2 options |
| AMRAAM | Up to $20.7 billion | 5 years + 2 options |
| SM-3 Block IB | Up to $6.3 billion | 5 years + 2 options |
| SM-3 Block IIA | $745 million | Production and sustainment |
The Tomahawk contract was announced in August, followed by the AMRAAM, SM-6 and SM-3 Block IB awards in September and October 2026. The SM-3 Block IIA contract was announced in August.
Raytheon is expanding production across its facilities in Tucson, Arizona, Huntsville, Alabama, and Andover, Massachusetts. The company also reported that total munitions deliveries had increased by more than 40% year over year.
These agreements provide long-term procurement commitments and greater certainty for suppliers to invest in manufacturing facilities and production lines.
Lockheed Martin Expands Patriot and THAAD Interceptor Manufacturing
Lockheed Martin is undertaking one of the largest US missile-defence production expansions.
On July 29, 2026, the company announced a seven-year PAC-3 MSE production contract bringing the total multiyear programme value to $58.62 billion. The agreement targets an increase in annual production capacity from approximately 600 to 2,000 interceptors by the end of 2030.
The company also received a separate seven-year contract action worth up to $35 billion to expand THAAD interceptor production from 96 to 400 annually.
Lockheed Martin is expanding manufacturing facilities, hiring additional workers and investing in advanced manufacturing technologies. Its Camden, Arkansas, facility is expected to increase its workforce from approximately 1,200 to 1,850 employees.
Lockheed Martin production expansion
| Weapon system | Existing annual capacity | Future annual target | Contract value |
|---|---|---|---|
| PAC-3 MSE | 600 | 2,000 | $58.62 billion |
| THAAD | 96 | 400 | Up to $35 billion |
| PrSM | Baseline not disclosed | Approximately 550 | Multiyear expansion |
The PrSM target reflects the Pentagon's projected industrial capacity, rather than a separately confirmed annual delivery commitment.
Lockheed Martin's wider manufacturing programme includes a new Munitions Acceleration Center in Camden, Arkansas, intended to improve production speed and manufacturing capacity.
Northrop Grumman, L3Harris, Boeing and BAE Systems Expand Missile Components
The production expansion also involves companies manufacturing the rocket motors, propulsion systems and guidance components required for advanced interceptors.
| Company | Programme | Announced contract or investment | Production expansion |
|---|---|---|---|
| Northrop Grumman | PAC-3 MSE and THAAD components | More than $3 billion | Higher component and rocket motor output |
| L3Harris | PAC-3 MSE propulsion | $4.7 billion | Multiyear propulsion expansion |
| L3Harris | THAAD propulsion | More than $6 billion | Quadruple propulsion production |
| Boeing | PAC-3 MSE seekers | Approximately $14.7 billion | Triple seeker production |
| BAE Systems | THAAD infrared seekers | Seven-year framework | Quadruple seeker production |
| Honeywell Aerospace | Critical defence technologies | $500 million investment | Manufacturing capacity upgrades |
Northrop Grumman's August agreement includes $2 billion for PAC-3 MSE components and $1 billion for THAAD components. Its investments since 2021 have doubled solid rocket motor delivery capacity at its Utah facilities, nearly tripled capacity at Allegany Ballistics Laboratory in West Virginia and increased capacity by 25% at its Elkton, Maryland, facility.
L3Harris received a $4.7 billion PAC-3 MSE propulsion contract and a separate contract valued at more than $6 billion for THAAD propulsion over seven years.
Boeing's approximately $14.7 billion agreement with Lockheed Martin supports a threefold increase in PAC-3 MSE seeker production. BAE Systems has separately agreed to quadruple THAAD infrared seeker production.
Honeywell Aerospace has committed $500 million to increase manufacturing capacity for critical defence technologies under a framework agreement with the Pentagon.
These companies are essential to the expansion because increasing complete missile production also requires a larger and more reliable supply of motors, seekers and other critical components.
US Moves Towards Mass Production of Affordable Cruise Missiles and Loitering Munitions
The Iran conflict has also highlighted the importance of inexpensive weapons that can be manufactured in large quantities. The United States is increasingly combining expensive precision missiles with affordable cruise missiles and one-way attack drones.
Anduril Industries has secured a Pentagon framework agreement for at least 3,000 surface-launched Barracuda-500M systems over three years, equivalent to a minimum of 1,000 annually.
In July 2026, Anduril announced another framework agreement for air-launched Barracuda-500 systems. It outlines a plan to deliver thousands of systems annually over seven years, with initial deliveries expected in 2027. These are framework production commitments, not evidence that the full quantities have already been delivered.
Major low-cost strike and loitering-munition programmes
| Company | Weapon system | Announced order or production commitment |
|---|---|---|
| Anduril | Barracuda-500M | Minimum 3,000 over three years |
| Anduril | Barracuda-500 | Thousands annually envisaged over seven years |
| AeroVironment | Switchblade 600 Block 2 | $186 million Army order |
| AeroVironment | Switchblade 600 Block 2 | Additional $51 million Army order |
| SpektreWorks | LUCAS | US military deployment; full production rate undisclosed |
AeroVironment has received two US Army delivery orders worth $186 million and $51 million for its Switchblade loitering-munition family. The orders fall under the Army's five-year, $990 million Lethal Unmanned Systems IDIQ contract. The $990 million is the overall contract ceiling, not a confirmed payment to AeroVironment.
The United States has also deployed its Low-Cost Uncrewed Combat Attack System (LUCAS), developed by SpektreWorks. The system reflects the Pentagon's interest in adopting affordable one-way attack drones and developing a mass-production capability influenced by the operational use of Iranian Shahed-type drones. Its full-rate production capacity has not been publicly established.
Pentagon Expands Counter-Drone Manufacturing and Maritime Defence
The war has demonstrated that using expensive missile interceptors against inexpensive attack drones can create significant financial and inventory pressures.
The US Army announced ten counter-unmanned aircraft system contract vehicles in September 2026, with a combined ceiling of approximately $4.15 billion. The agreements cover systems to detect, track, disable and destroy hostile aerial drones.
US Army counter-drone contract awards
| Company | Contract ceiling |
|---|---|
| Allen Control Systems | $500 million |
| Digital Force Technologies | $500 million |
| DroneShield | $500 million |
| L3Harris WESCAM | $500 million |
| Napatree Technology | $500 million |
| RADA Technologies | $500 million |
| SRC | $500 million |
| Echodyne | $250 million |
| PVP Advanced EO Systems | $250 million |
| SmartShooter | $150 million |
| Total | $4.15 billion |
These contracts cover radar, optical sensors, command-and-control equipment and weapon systems. The amounts are maximum contract ceilings, not guaranteed purchases or money already spent.
The Navy is also investing in autonomous maritime capabilities.
In September 2026, the US Navy awarded production agreements for 30 medium unmanned surface vessels, with 10 each assigned to Galliano Marine Services, HII and Saronic Technologies. The average procurement cost is approximately $40 million per vessel, with initial deliveries expected before the end of fiscal year 2027.
Separately, the Defense Innovation Unit's PRIME programme has moved more than 200 small unmanned surface-vessel interceptors into production. These autonomous vessels are designed to travel long distances, monitor maritime threats and intercept non-cooperative manoeuvring vessels. The programme primarily supports the Indo-Pacific region rather than being an Iran-specific procurement programme.
Can US Interceptor Production Exceed Iran's Missile Production by 2030?
One of the most important consequences of this industrial expansion is its potential effect on the balance between Iranian missile production and American interception capacity.
The Middle East Institute estimated that Iran may have replenished approximately 1,000 missiles during the eight months between the 2025 and 2026 conflicts. This suggested an earlier production rate of approximately 100–125 missiles per month, or 1,200–1,500 annually.
However, the 2026 US-Israeli campaign heavily targeted Iran's missile-industrial infrastructure. Although manufacturing reportedly resumed at surviving and improvised facilities, there is no authoritative public estimate of Iran's current missile production rate.
By 2030, the United States is targeting approximately 2,000 PAC-3 MSE and 400 THAAD interceptors annually.
US versus earlier estimated Iranian annual production
| Category | Annual quantity |
|---|---|
| Earlier estimated Iranian missile production | 1,200–1,500 |
| Planned US PAC-3 MSE capacity | 2,000 |
| Planned US THAAD capacity | 400 |
| Combined US interceptor capacity | 2,400 |
On a numerical basis, planned American PAC-3 MSE and THAAD production capacity could exceed the earlier estimate of Iranian ballistic missile production.
However, this is not a direct one-to-one comparison. Both interceptor systems have different engagement roles, some threats require multiple interceptors, and US manufacturing must also supply allied countries and replenish existing stockpiles.
Therefore, the expansion could give Washington a significantly stronger industrial position, but it does not guarantee that every Iranian missile can be intercepted or that US interceptor production will always exceed Iran's future missile output.
A Major Shift in American Defence Manufacturing Strategy
The 2026 Iran conflict has reinforced a significant shift in US defence planning. Washington is moving towards a combination of advanced precision weapons and affordable mass-produced systems.
By 2030, the Pentagon wants substantially greater manufacturing capacity for Tomahawk cruise missiles, Patriot and THAAD interceptors, naval missiles, low-cost cruise missiles and loitering munitions. At the same time, investments in counter-drone technology and autonomous maritime systems are intended to address threats that cannot be efficiently countered through expensive traditional missiles alone.
The central lesson from the Iran conflict is that military strength depends not only on advanced weapons but also on the ability to manufacture, deliver and replenish them at the speed required during a prolonged conflict. The American defence industry is now being reorganised around that requirement, although achieving the announced production targets will depend on funding, workforce expansion, factory construction and the availability of critical components.
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