Navy Awards Raytheon $22.9 Billion Contract for Tomahawk Missiles

On Monday, August 17, the U.S. Navy awarded a $22.9 billion contract to Raytheon to accelerate production of Tomahawk missiles.

The contract, awarded to RTX subsidiary Raytheon, aims to ramp up annual production of the Tomahawk cruise missile to 1,000 rounds a year, an increase from the current 60 per year. Acting Navy Secretary Hung Cao announced the deal, stating it reinforces the Department’s commitment to rebuilding the defense industrial base. Raytheon President Phil Jasper said the company is making investments in our workforce, technology, supply chain and facilities to dramatically boost production capacity.

Michael Duffey, the Pentagon’s top acquisition official, stated the award increases our ability to equip the Joint Force. This formal announcement firms up a framework agreement signed between the U.S. military and Raytheon in February. The production increase will occur over a multiyear period, and the contract itself will run for seven years. The U.S. military has been scrambling to rebuild depleted stocks of high-tech weaponry.

The contract comes amid a munitions shortage in the months after the start of the Iran war. The U.S. has supplied large amounts of arms to allies and used munitions in the Iran conflict, raising concerns about inventories of air defense and precision-guided weapons. The sea-launched Tomahawk is a mainstay of the Navy’s surface fleet, providing long-range precision strike capability against land targets from ships and submarines. The administration of President Donald Trump is brokering multi-year deals with the biggest U.S. defense contractors to incentivize investments in new facilities and equipment.