WASHINGTON — Northrop Grumman has quietly asked the Federal Trade Commission to remove restrictions on its solid rocket motor business, in a move that competitor Lockheed Martin opposes, setting up a rare regulatory battle between two of the world’s largest defense firms.
The FTC’s decision could have implications not only for the defense industrial base, but for the Pentagon’s race to ramp up the production of missiles and backfill its stockpiles — an endeavor dependent on also ramping up the manufacture of solid rocket motors (SRMs).
On April 2, Northrop petitioned the Federal Trade Commission to drop a 2018 consent order helmed when Northrop acquired solid rocket motor maker Orbital ATK. The consent agreement requires Northrop to supply SRMs to its competitors in the missile market on a non-discriminatory basis and to firewall its SRM business away from its other operations.
At the time, the FTC believed the measure was necessary due to Northrop’s status as a prime contractor and Orbital ATK’s position as one of only two American makers of solid rocket motors.
Northrop is not a major manufacturer in the American missile space, which is dominated by Raytheon and Lockheed. However, if the order is dropped, Northrop will be able to vertically integrate its solid rocket motor business with any munitions the company designs in the future — including potentially prioritizing SRM supplies for Northrop over competitors, Lockheed stated in a response to the petition.
“We stand behind the strength of our petition,” Northrop said in a statement. “Removing the order will allow us to better support our customers’ needs for critical munitions and accelerate support for key missile programs as a merchant supplier of SRMs.”
A Lockheed spokesperson said in a statement that the removal of the order would “significantly limit affordable access to SRMs,” potentially jeopardizing readiness and weakening the industrial base.
Winning the cognitive domain — A methodology built for democratic constraints
The challenge for Western democratic institutions is not a lack of capability — it is a structural one.
“This result creates a vulnerability for America and its allies, given the ever-increasing demand for these SRMs that power the critical defense systems protecting us all,” the spokesperson said.
READ MORE: With the boom for solid rocket motors for missiles, a perilous crunch in the supply chain
In a statement to Breaking Defense, a Pentagon official declined to specifically comment on whether the department is supportive of Northrop’s petition.
“The Department is aware of Northrop Grumman’s petition to reopen and set aside its 2018 Consent Order, which was a condition of its acquisition of Orbital ATK, Inc. The Department of War will work with [the] FTC as appropriate during their review,” the official said.
A Market Transformed?
In its petition, Northrop contends that the consent order imposes an administrative burden that will make it difficult for the company to meet the Pentagon’s demand on SRMs as speedily as possible.
“Not only is the Order no longer necessary to preserve competition, keeping it in place for the next twelve years would run counter to DoW priorities,” it states.
The company also says that the consent order is no longer necessary because of the changing SRM market, which has expanded from a duopoly to a more competitive industry with new entrants — which include companies like Anduril and X-Bow — and federal funding such as the Pentagon’s equity stake in L3Harris’ missile systems spin off.
“These changed conditions spurred by market participants overcoming barriers to entry and increased demand have eliminated any possible incentive Northrop Grumman may have had to discriminate in the provision of SRMs,” Northrop said in the petition.
“Simply put, Northrop Grumman depends more on other primes for its business than other primes depend on Northrop Grumman, and Northrop Grumman has a market incentive to maintain strong merchant-supplier relationships with all third-party primes.”
But Lockheed argued in a May 4 comment on Northrop’s petition that the fundamentals of the SRM market has not “materially changed,” as the new entrants currently working to develop and certify motors are not yet able to produce large SRMs at scale.
Anduril, X-Bow and Ursa Major have all received development or prototyping funds from the Defense Department — not full scale production contracts — while other vendors like Firehawk Aerospace and Prometheus Energetics have only recently broken ground on SRM production facilities, Lockheed stated in the comment.
“Northrop Grumman’s petition reflects the desired end-state of competition among SRM suppliers but not the reality of today,” Lockheed said.
“Prospective new entrants cannot meaningfully compete in the SRM supply base until they reach full-rate production,” the company said. “None have done so.”
In some cases, Northrop remains the sole supplier of certain large SRMs required for strategic missiles, hypersonic weapons and other munitions — including for Lockheed’s Conventional Prompt Strike weapon and the Trident D5.
Lockheed added that it expects Northrop will continue to compete as a prime contractor for missile systems, making the restrictions “pivotal to prevent discrimination in the supply of large SRMs” to rival defense primes in the missile market.
The SRM industry has long been a source of drama within the defense industrial base, both due to the production constraints afflicting SRM producers and the various corporate shakeups and controversies that have occurred in the past decade.
Lockheed has had a vested interest in the solid rocket motor space not just due to its status as one of the nation’s top munitions providers but also because of its thwarted attempt in 2022 to acquire Aerojet Rocketdyne, the other major American SRM producer. The FTC opposed Lockheed’s bid to acquire Aerojet, stating at the time that the merger could empower Lockheed to disadvantage its competitors.
Aerojet was eventually purchased by L3Harris in 2023 — an acquisition Lockheed also opposed.
Meanwhile, during the Biden era, the FTC considered bringing legal action against Northrop in 2022 for alleged violations of the consent order, Politico reported then.
It’s not surprising that Northrop would seek to set aside the 2018 consent order given the dramatic growth in the market for both munitions and solid rocket motors, said Roman Schweizer, a defense analyst with TD Cowen.
“Other companies in the market do not have to operate with similar constraints, and I suspect Northrop Grumman would like to offer fully integrated systems to the War Department like some of the emerging providers of lower-cost munitions,” he said.
He added that “many of the prior assumptions about the market and key participants” made by the consent agreement “aren’t really valid anymore.”
Rebecca Grant, an analyst with the Lexington Institute, said the FTC should set aside the consent order and allow for the solid rocket motor market to function without government interference.
“The solid rocket motor market of 2026 is healthy and highly competitive. Big primes and new entrants like Anduril are heavily invested,” she told Breaking Defense.
“Northrop Grumman will still be the sole supplier for larger solid rocket motors. So what?” she added. “The central fact is that there are now multiple suppliers for tactical missile solid rocket motors and Northrop Grumman is a merchant supplier incentivized to offer a good price to its customers.”