The agreement builds on a $4.94 billion contract awarded by the U.S. Army last year. Combined, these actions are expected to quadruple production capacity for the missile system.
The initiative includes provisions for a potential multi-year contract of up to seven years. This would depend on future congressional authorization and approval of multi-year procurement authority.
The Precision Strike Missile is designed to replace the Army Tactical Missile System. It offers extended range, improved lethality and increased flexibility across launch platforms.
On March 4, U.S. Central Command confirmed the system was used in combat for the first time during Operation Epic Fury. The use marked its operational debut and demonstrated its deep-strike capabilities.
“Lockheed Martin delivers the advanced precision fires capabilities the warfighter needs, including the Precision Strike Missile (PrSM), which expands deep-strike capability,” said Jim Taiclet, chairman, president and chief executive officer of Lockheed Martin. “We are working closely with the Department of War and the U.S. Army to scale production to meet operational demand and ensure the joint force has the capabilities needed to deter and defeat emerging threats.”
The agreement supports broader efforts to strengthen the U.S. defense industrial base and improve readiness. Lockheed Martin said it is increasing production using advanced manufacturing and digital engineering approaches.
The company has invested more than $7 billion since President Donald Trump’s first term to expand production capacity for key systems. This includes approximately $2 billion focused on increasing munitions output.
Lockheed Martin said it has more than 115,000 square feet of dedicated production space for the Precision Strike Missile in the United States. More than 400 employees are currently supporting the program.
The company also continues to expand its workforce to meet demand. It said the effort is creating thousands of jobs across manufacturing, engineering and skilled trades.
