IRIA News

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The U.S. Department of War has awarded RTX’s Raytheon a multiyear contract worth up to $20.7 billion to accelerate production of Advanced Medium-Range Air-to-Air Missiles (AMRAAM), as Washington moves to replenish missile stocks and expand weapons production.

The five-year contract, with two additional option years, is expected to nearly double AMRAAM production from previous levels. The deal covers purchases by the U.S. Air Force, Navy, and international customers.

The Pentagon awarded the contract on September 25 and announced it on September 28, 2026, as part of its “Arsenal of Freedom” initiative, which aims to increase the production of key weapons and strengthen the U.S. defense industrial base.

The $20.7 billion ceiling is significantly larger than the Pentagon’s previous record AMRAAM contract, a $3.5 billion award issued in July 2025. That earlier deal covered missiles for the U.S. Air Force and Navy as well as allies in Europe, Asia, and the Middle East.

Under the new agreement, Raytheon will increase production to meet growing demand from the U.S. military and international customers. However, neither the Pentagon nor RTX has specified how many missiles the new contract will ultimately cover or what annual production rate will be achieved under the award.

The Pentagon said the contract is part of a wider effort to increase the production of munitions following heavy demand and the use of U.S. weapons in recent conflicts.

“We are working across the defense industry to ramp production and build the Arsenal of Freedom,” said Michael Duffey, undersecretary of defense for acquisition and sustainment.

“This award strengthens our ability to equip the Joint Force and our allies with a proven air-to-air capability, ensuring our warfighters maintain a decisive advantage,” he added.

Air-to-Air and Air Defense Roles

AMRAAM is a medium-range air-to-air missile used by fighter aircraft to engage airborne targets beyond visual range. It uses an onboard guidance system to track and intercept targets after launch and is designed to operate in contested environments.

The missile is also used in the National Advanced Surface-to-Air Missile System, or NASAMS, providing a ground-based air defense capability. NASAMS is used to protect the Washington area and is also operated by more than a dozen countries, including Ukraine, Oman and Qatar.

RTX says the latest version of AMRAAM is the fifth generation of the missile. The system is deployed on 14 platforms and has been fielded by 44 countries, with more than 7,000 successful live-fire tests and combat launches, according to the company.

The missile has also received upgrades to its processors and software, allowing it to receive updates intended to address changing threats.

Rebuilding Missile Stocks

The contract comes as the Pentagon seeks to rebuild U.S. munitions inventories after large quantities of weapons were supplied to allies and others were used in U.S. military operations.

The U.S. has provided significant amounts of weapons to partners during conflicts, while its own forces have also used air defense and precision-guided munitions. This has increased attention on the size and readiness of U.S. missile inventories.

The Pentagon has therefore pursued a series of large procurement agreements aimed at increasing production rates.

The AMRAAM contract follows a similar $58.6 billion agreement with Lockheed Martin for PAC-3 Patriot interceptors announced in July. That deal covers a seven-year procurement plan running through fiscal 2032.

The broader production push is intended to give defense companies greater certainty about future orders so they can expand factories, workforce capacity and supply chains.

Funding Depends on Congress

Although the Pentagon has awarded the multiyear contract, Congress has not yet appropriated all of the funding needed to support the full $20.7 billion commitment.

The contract is therefore dependent on future congressional funding. Industry executives have warned that companies may be reluctant to make major investments in production facilities and components until lawmakers provide the necessary funding.

Multiyear procurement authority allows the Pentagon to commit to purchasing weapons over several years instead of negotiating separate purchases each year. The department has said additional authority and funding would help sustain higher production levels.

RTX said it nearly doubled AMRAAM production in 2025 compared with 2024 and continues to invest in its workforce, supply chain and manufacturing facilities. The company is also exploring international co-production as demand for the missile increases.

Production Framework

The new contract follows five framework agreements Raytheon signed with the Pentagon in February that established long-term production targets for several major weapons.

Under those agreements, RTX committed to increasing annual production to at least 1,900 AMRAAM missiles, more than 1,000 Tomahawk cruise missiles and more than 500 Standard Missile-6 interceptors.

The framework agreements were designed to provide a longer-term basis for expanding production before individual procurement contracts were finalized.

The Pentagon’s latest AMRAAM award is part of that broader effort to increase the output of weapons considered important to U.S. and allied forces.

AIM-260 development continues

At the same time, the U.S. is preparing to replace AMRAAM. Earlier in September, the Pentagon signed a framework agreement with Lockheed Martin to increase production of the AIM-260 Joint Advanced Tactical Missile, or JATM.

The AIM-260 is being developed for the U.S. Air Force and Navy as a longer-range air-to-air missile. It is intended to provide greater range than AMRAAM and eventually replace the older missile in some roles.

The continued production of AMRAAM alongside development of the AIM-260 reflects the U.S. effort to maintain current air-to-air missile stocks while preparing for a new generation of weapons.