Pentagon awards RTX’s Raytheon $20.7 billion contract for AMRAAM missiles amid stockpile concerns

On September 28, the Pentagon announced it had awarded Raytheon Technologies, a subsidiary of RTX, a provisional multiyear contract worth $20.7 billion. This contract aims to expedite the production of Advanced Medium-Range Air-to-Air Missiles (AMRAAM), a crucial air defense weapon. The U.S. has been replenishing its stockpiles of AMRAAM missiles as conflicts in the Middle East and Ukraine have depleted them.

The Pentagon has been awarding large defense contracts to contractors in an effort to accelerate production and replenish stockpiles. The AMRAAM missile is used in air-to-air jet fighter combat and in surface-to-air missile systems, such as NASAMS, which are used by the U.S., Ukraine, Oman, and Qatar. However, there are concerns about inventory levels of key air defense and precision-guided weapons, as the U.S. has supplied weapons to allies and used them in its own military operations.

The contract follows a similar $58.6 billion deal awarded to Lockheed Martin for Patriot interceptors earlier this year. Congress has yet to appropriate the necessary funding for the full multiyear commitment, which could delay contractors' ability to scale up production. The Pentagon's production agreements with contractors like Raytheon are intended to incentivize faster output increases, as part of the administration's broader strategy to prioritize weapons production over shareholder returns.