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The US Department of Defense has announced a $22.4 billion deal with Raytheon, a major US arms supplier, to fill a shortfall in US stockpiles after the massive use of ammunition and missiles in the Iran war.
The deal was announced on Thursday (October 1) local time to increase production of SM-6 missiles, Arab News reported.
The Pentagon said in a statement that the missiles are “critical to the destruction of air and sea targets. The five-year contract includes an option to extend for another two years, which will further accelerate the production process.”
The US Navy said the purpose of the deal is to ensure an uninterrupted and reliable supply of Standard Missile-6 (SM-6) interceptor missiles, which are capable of both offensive and missile defense.
The statement added that the agreement will provide long-term assurances to the defense industry, which is essential to increase the capabilities of their manpower or workforce and secure critical supply systems.
The new deal is the latest in a string of major military contracts the Pentagon has signed this year to pressure contractors to ramp up production. In September, the Pentagon awarded $20.7 billion to Raytheon for air-to-air missiles and $58.6 billion to Lockheed Martin for Patriot interceptors. The deals are part of the Trump administration’s push to prioritize weapons production.
But industry executives have warned that the US Congress has not yet appropriated the necessary funds for the contracts, meaning it could be difficult for contractors to make large-scale investments until lawmakers take final action.
Trump is not paying much attention to the question of the massive shortage of US ammunition stocks that has arisen since the start of the Iran war on February 28.
But last month, the Department of Defense’s inspector general said the operation against Iran had caused a shortage of strategic stockpiles due to the use of ammunition and exposed the limitations of the industrial-production structure in supplying new ammunition.
In addition, a report by the Congressional Budget Office on September 15 cited the adverse impact on missile defense equipment, saying that as a result, the United States’ stockpile of interceptors or missile-destroying missiles will be limited in the coming years.
Seven months after the US and Israeli attacks on Iran, Tehran retains control of the strategically important Strait of Hormuz, while Washington continues to blockade Iranian ports.
According to a report in the Wall Street Journal, Trump has told his aides that he expects to resume bombing Iran by the end of November, which would require the use of even more US ammunition.