Lockheed to quadruple THAAD production

Lockheed is set to quadruple production of the interceptor missiles for the Terminal High Altitude Area Air Defense (THAAD) system under a new framework with the Department of War, but there is a long road ahead.

By Sam Cranny-Evans, published on January 30, 2026. 

BLUF: 

• THAAD interceptor production capacity set to increase from 96 units per year to 400. 
• Recent engagements have revealed potential short falls in the US’s ability to sustain a defensive posture during prolonged missile exchanges. 

Lockheed Martin and the US Department of War have signed a framework agreement to quadruple THAAD interceptor production from 96 missiles per year to 400, according to a January 29 press release. The agreement follows a similar announcement for the PAC-3 MSE interceptor earlier this year and comes amidst growing concern about the West’s ability to produce enough air defence missiles. 

The two organisations are working towards a first contract award under the framework, which is expected in the course of 2026 pending Congressional approvals. It will require significant investment to boost production of the missile, which has been in service since 2012.

In that time the US forces are understood to have procured just 646 THAAD interceptors, and international customers have ordered a few hundred more at most. Production and orders are likely to total around 1,000 interceptors, as BAE announced delivery of the 1,000th seeker in August 2025. 

• BAE delivers 1,000th THAAD seeker – Calibre Defence
• Lockheed Martin’s missile production in numbers – Calibre Defence 
• PAC-3 MSE: Lockheed and Diehl sign MoU to expand production – Calibre Defence 

To support the effort, Lockheed added that it will break ground today on a new “Munitions Acceleration Center in Camden, Ark. This world-class facility will prepare the workforce of the future to build THAAD, PAC-3 and other capabilities using advanced manufacturing, robotics and digital technologies.”

What are the bottlenecks in missile production?

At present, Lockheed has a 31,500 square metre (340,000 square feet) facility and 2,000 employees supporting THAAD production. The company has increased manufacturing jobs by 60% since Trump’s first term, and plans another 50% growth to accomplish the planned increases, according to the press release. 

The company also emphasised the $2 billion that it has invested since Trump’s first term to accelerate munitions production in the press release. More recently, the company provided a munitions production update, stating that PAC-3 MSE production has reached 600 units per year, while the Precision Strike Missile (PrSM) is on course for 400 missiles in an annual production cycle, and GMLRS figures should reach 14,000 per year. 

However, under the frameworks signed with the Department of War, Lockheed will be aiming to increase PAC-3 production to more than 2,000 missiles per year. With this expansion set to take place alongside the very significant uplift in THAAD output, the company will be hard-pressed to expand both its work force and facilities. 

But another issue is component production. This framework would mean that BAE Systems will also have to increase seeker production to a similar or greater extent. And the US will have to find more solid fuel rocket motors, but not just for THAAD – the same or similar materials are used in the PAC-3, SM-3, PrSM, and many other guided missiles.

• Anduril and Raytheon test new rocket motor as US works to restore air-to-air superiority – Calibre Defence
• Patriot returns: Bayern-Chemie breaks ground on new rocket engine facility Calibre Defence

Rocket fuel production is already a bottleneck in missile output and this is as true for Europe as it is for the US. So, if the THAAD and PAC-3 production targets are to be realised, they will have to come with a very significant uplift in production throughout the supply chain. Some elements of that might be easier than others.

Calibre comment: Why is air defence so important?

The US forces need time. Time to get into a theatre, time to stack up resources and people. Time to degrade an adversary’s key enablers. This has always been the case, but the challenges of operating in the Indo-Pacific are quite unique. China has made it clear, through exercises and its procurement, that it intends to hold US forces at bay with long-range missile strikes. It has the ability to strike targets throughout the Indo-Pacific and so too does North Korea. 

At the same time, Iran has demonstrated the ability to generate several very large ballistic missile attacks. Defending Israel in 2025 led to 150 THAAD interceptors being used – close to a quarter of all interceptor production. Of course, counter-strikes against missile stores and launch platforms are a key component of an effective air defence. But having a greater magazine depth and production capacity would give some flexibility in terms of response and posture. 

The lead image shows THAAD missiles in storage. Credit: Lockheed Martin.