Northrop Grumman Wins $233 Million Contract for U.S Navy’s Next-Gen MK 54 MOD 2 Lightweight Torpedo

Washington / Plymouth, Minnesota : Northrop Grumman has secured a $233 million contract from the United States Navy to integrate and conduct initial proof of manufacturing for the service’s next-generation MK 54 MOD 2 lightweight torpedo, a programme aimed at significantly strengthening American and allied anti-submarine warfare capabilities.

The award, announced by the company on 12 January, covers proof-of-manufacturing and qualification activities, along with the delivery of multiple torpedoes to support qualification and live-fire testing. Central to the upgrade is a newly developed custom-design warhead, intended to improve lethality against increasingly advanced submarine threats operating across diverse ocean environments.

A Cooperative Programme with Allied Focus

The MK 54 MOD 2 is being developed under the U.S. Navy’s Advanced Lightweight Torpedo programme through a cooperative development agreement with the Australian Defence Force. The partnership reflects a broader effort to align undersea warfare capabilities among close allies while accelerating development timelines through shared research and testing.

Building on the fielded MK 54 MOD 0 and MOD 1 weapons, the MOD 2 variant introduces a two-increment development approach. Increment 1 focuses on improved lethality through an enhanced warhead and upgraded processing, while Increment 2 will deliver a major propulsion upgrade designed to improve range, speed and depth performance.

Rapid Prototyping and Manufacturing Integration

Northrop Grumman’s latest award takes the form of a rapid-prototyping Other Transactional Authority (OTA) contract for the MK 54 MOD 2 Increment 1 all-up-round configuration. This configuration combines the MOD 2 forebody developed during the Proof of Design phase with a new adapter section and the legacy Otto II fuel propulsion afterbody used in MK 54 MOD 0 and MOD 1 torpedoes. The propulsion section will be supplied as government-furnished material for integration.

Manufacturing integration and initial proof-of-manufacture work will be conducted at Northrop Grumman’s facility in Plymouth, Minnesota, and at the Allegany Ballistics Laboratory in Rocket Center, West Virginia. The contract also supports developmental testing, warhead and all-up-round qualification, live-fire trials and activities leading to initial operational capability, while maturing the production line for rapid fielding once full-rate procurement begins.

Unconventional Acquisition Strategy

The U.S. Navy has pursued an accelerated and flexible acquisition strategy for the MK 54 MOD 2, making extensive use of University Affiliated Research Centers, naval warfare laboratories and competitive OTA agreements. During the Proof of Design phase, four companies were selected to develop key subsystems, with Northrop Grumman responsible for the warhead section, L3Harris Aerojet Rocketdyne for the stored chemical energy propulsion system afterbody, Progeny for guidance and control, and Raytheon for test equipment, test shapes, and air-launch and fleet exercise hardware.

This approach is intended to reduce development risk while compressing schedules, enabling the Navy to respond more rapidly to evolving undersea threats.

Incremental Capability Growth

Increment 1 of the MK 54 MOD 2 will deliver a partial but operationally significant capability centred on improved lethality and processing performance, particularly in complex littoral and shallow-water environments. The full capability set will follow under Increment 2, when the existing Otto II fuel engine is replaced by a stored chemical energy propulsion system.

The SCEPS design uses a lithium boiler to generate steam that drives a turbine, offering higher energy density and improved endurance compared with traditional propulsion. In August 2025, L3Harris reported successful testing of the SCEPS powerplant, validating its performance ahead of full afterbody design verification testing.

Industry Experience and Fleet Impact

Northrop Grumman said it will draw on more than 80 years of torpedo and undersea weapons experience to deliver a weapon capable of launch from multiple naval platforms, including surface ships, fixed-wing aircraft and helicopters. The company highlighted its manufacturing capacity and deep-ocean engineering expertise as key enablers for meeting urgent operational requirements.

“This new weapon will provide U.S. and allied sailors with a next-generation response to counter the most advanced undersea threats,” said Dave Fine, vice president for armament systems at Northrop Grumman, noting that the company’s production approach is designed to accelerate qualification and delivery to the fleet.

When fielded, the MK 54 MOD 2 is expected to enhance existing MK 54 inventories through improved warhead effectiveness, upgraded processing and, ultimately, a more capable propulsion system. For the U.S. Navy and its allies, the programme represents a critical investment in maintaining undersea dominance as submarine technologies continue to advance.