Northrop gets $3B framework deal to increase motor production for PAC-3, THAAD

WASHINGTON — Northrop Grumman will become a second supplier of rocket motors for the in-demand PAC-3 interceptor while also increasing motor production for THAAD missiles, under a new pair of multiyear deals worth a combined $3 billion.

The deals, announced today, mark the first time Northrop has entered into a framework agreement with the Pentagon since the department began a push to use multiyear agreements to entice defense firms to invest their own capital to help scale munitions production.

Both agreements span a total of seven years, with the PAC-3 deal valued at $2 billion and the THAAD deal valued at $1 billion, Northrop said in a news release. Northrop’s Allegany Ballistics Laboratory in West Virginia will stand up production for solid rocket motors for PAC-3, while the additional THAAD motor production will take place at its San Diego plant.

“Building the Arsenal of Freedom requires robust, dynamic supply chains at every level of the industrial base,” Michael Duffey, the Pentagon’s top acquisition official, said in a statement. ” Under Secretary of War for Acquisition and Sustainment. “”Framework agreements with munition components suppliers like Northrop Grumman are vital to accelerating the tripling of PAC-3 and quadrupling of THAAD interceptor production.”

The Northrop deal follows a similar agreement to boost THAAD and PAC-3 solid rocket motor production, signed last week by L3Harris and the Pentagon. L3Harris is currently the sole producer of SRMs for PAC-3.

Since the beginning of the year, the Pentagon has signed about a dozen framework agreements with defense companies to boost production rates for in-demand munitions like the Tomahawk cruise missile and for key components like solid rocket motors and seekers. One of the first of those agreements was a January deal with PAC-3 prime contractor Lockheed Martin to triple production of the interceptor over a seven year period and raise production capacity to 2,000 a year by the end of 2030. Lockheed signed an agreement to quadruple THAAD production just a few weeks later.

The department has also entered into similar deals with defense tech startups like Anduril and Zone 5 to boost production rates of new, low-cost munitions under the Low Cost Containerized Munitions program and other such efforts.