US Awards Raytheon Massive $22.9 Billion Tomahawk Contract to Replenish Dwindling Stockpiles Amid Iran Conflict

The US announced on Monday that it has awarded RTX's Raytheon unit a massive $22.9 billion contract to scale up Tomahawk missile production. This move comes as the Pentagon scrambles to replenish crucial munitions stockpiles that have been heavily depleted by the ongoing Iran war.

Growing apprehension surrounds the conflict, which has severely drained US inventories of precision-guided weapons and air defence systems like Patriot and Terminal High Altitude Area Defence (THAAD). Despite these reports, President Donald Trump's administration has downplayed the concerns.

“The department called upon industry to expand munitions production, and RTX has answered that call,” stated Michael Duffey, Under Secretary of War for Acquisition and Sustainment.

In a separate announcement, Raytheon detailed that the seven-year contract awarded by the US Navy will dramatically boost annual production from 60 to more than 1,000 Tomahawk missiles per year. This agreement builds upon prior arrangements between Raytheon and the Pentagon for the long-range, precision-guided weapon capable of launching from ships, submarines, and ground installations.

“Tomahawk is the Navy's most important strike weapon, able to target hostile forces hundreds of miles away without ever risking the lives of our sailors,” noted Raytheon president Phil Jasper.

“This landmark $22.9 billion investment accelerates the delivery of Tomahawk missiles to our warfighters at unprecedented speed,” added Hung Cao, Acting Secretary of the Navy.

Monday's formal announcement solidifies a framework agreement initially signed by Raytheon and the US military in February. It stands as just the latest multibillion-dollar procurement deal secured by the military with top US defence contractors.

A July analysis by the Centre for Strategic and International Studies estimated that US Patriot missile inventories have dropped below 1,000 from a previous 2,330 since the start of the Iran conflict in February, while THAAD inventories declined from 452 to approximately 250. To counter this, the Pentagon announced framework agreements this month with Northrop Grumman and Lockheed Martin to accelerate missile component manufacturing. Officials stated these pacts will triple production for Patriot Advanced Capability-3 (PAC-3) missiles and quadruple THAAD production, following a $58.6 billion deal with Lockheed Martin in July for Patriot interceptor missiles. Additionally, Mr Trump signed an executive order in January aimed at scrutinising defence contractors that issue stock buy-backs and dividends during periods of underperformance.