- DOW has signed multiyear procurement agreements with two defense contractors
- PAC-3 MSE and THAAD interceptor output is set to triple and quadruple, respectively
- The agreements guarantee minimum annual procurement quantities to industry
The Department of War has signed two seven-year procurement agreements with General Dynamics Ordnance and Tactical Systems, or GD-OTS, and Lockheed Martin to expand manufacturing capacity for missile subcomponents supporting the Terminal High Altitude Area Defense, or THAAD, and Patriot Advanced Capability-3 Missile Segment Enhancement, or PAC-3 MSE, interceptor programs.
What Are the Production Goals Under the Framework Agreements?
DOW said Monday the agreements set specific manufacturing targets for GD-OTS, including tripling production capacity for PAC-3 MSE interceptors and quadrupling production capacity for THAAD interceptors. The frameworks also call for increased manufacturing output of interceptor subcomponents, including motor cases, seeker housings, midsections and shroud deployment systems.
Under the frameworks, GD-OTS will lead the rapid scale-up of specialized interceptor components, while the agreements guarantee minimum annual procurement quantities to both companies. Funding for the agreements is subject to annual appropriations. The department said the guaranteed demand signal is intended to allow GD-OTS and its lower-tier suppliers to invest in workforce expansion, bulk material purchases and facility upgrades.
What Did DOW Under Secretary Michael Duffey Say About the Agreements?
Michael Duffey, under secretary of war for acquisition and sustainment and a 2026 Wash100 awardee, said the agreements represent an example of how the department is evolving its approach to industry partnerships.
“Today’s announcement represents an example of the evolution of how we partner with industry to expand the Arsenal of Freedom, outpace emerging threats, and ensure the Warfighter never faces a fair fight,” Duffey said. “General Dynamics and Lockheed Martin have answered the call. We are cutting red tape, shortening timelines, and rapidly scaling our domestic manufacturing capacity to deliver the advanced air and missile defense capabilities.”
What Are the Other Framework Agreements DOW Has Signed?
The deals with General Dynamics and Lockheed are the latest in a wave of framework agreements DOW has signed to shore up its munitions industrial base. DOW previously reached similar arrangements with Boeing and RTX to expand SM-3 missile production and inked $3 billion in PAC-3 and THAAD production deals with Northrop Grumman. Around the same time, the department also struck agreements with L3Harris to expand PAC-3 MSE and THAAD propulsion production, and with Lockheed, BAE Systems and Honeywell to scale up missile production and strengthen the broader supply chain.
Beyond interceptor programs, DOW has extended the same framework agreement model to lower-cost strike weapons, signing deals with Anduril, CoAspire and Zone 5 to advance cruise missile development and partnering with Leidos and Anduril to accelerate low-cost strike weapons production.
