Lockheed Martin Wins $35 Billion THAAD Deal as Pentagon Seeks to Rebuild Iran War Stocks
Updated
Updated · Foreign Policy · Jun 25
Lockheed Martin Wins $35 Billion THAAD Deal as Pentagon Seeks to Rebuild Iran War Stocks
3 articles · Updated · Foreign Policy · Jun 25
Summary
$35 billion will fund Lockheed Martin’s seven-year effort to quadruple THAAD production, one of the Pentagon’s biggest moves yet to replenish missile-defense inventories drained by the Iran war.
Nearly 14,000 strike munitions were used in the conflict, and Deputy Defense Secretary Stephen Feinberg reportedly told lawmakers the total bill could reach $80 billion once air-defense interceptors are included.
Trump invoked the Defense Production Act before the ceasefire and this week pressed major defense executives to accelerate output, while saying automakers could shift excess factory capacity toward missile production.
The Army is also seeking cheaper interceptors priced below $1 million, with rapid testing planned this year, as the Pentagon tries to widen supply beyond high-end systems like THAAD and Patriot.
NATO adds to that pressure: allies aim to spend 5% of GDP on defense by 2035, but Secretary-General Mark Rutte said weapons output still is not meeting demand at the needed scale or speed.
Can the US defense industry quadruple missile output in time to meet urgent global threats?
Will America's massive munitions buildup deter conflict or trigger a new global arms race?
Is spending billions on million-dollar missiles a winning strategy against low-cost drones and rockets?
U.S. Launches $35 Billion THAAD Production Surge: Strategic, Economic, and Global Impacts Through 2032
Overview
In 2026, Lockheed Martin was awarded a landmark $35.3 billion contract to dramatically expand production of THAAD missile interceptors, a move central to the Department of War's Acquisition Transformation Strategy. This multi-year agreement aims to boost U.S. missile defense by scaling up manufacturing across several key locations, including a new Munitions Production Center in Troy, Alabama. Lockheed Martin is investing over $9 billion through 2030 to support this surge, while partners like BAE Systems will increase output of advanced infrared seekers, which are vital for THAAD's hit-to-kill technology. Together, these efforts strengthen America's defense readiness against evolving global threats.