Raytheon wins huge contract to build missiles for US Navy with shared guidance technology

Raytheon’s Tucson-based missile manufacturing operation has won a $344 million U.S. Navy contract to develop two military Standard Missile variants that will share guidance technology.

Under the modernization contract, the missiles — the SM-2 Block IIICU and the SM-6 Block IU — will be built to both use a newly designed guidance section, target detection device, independent flight termination system and electronics unit. The common guidance section houses guidance electronics and software.

With both missiles using the same guidance section, Raytheon said it will be able to use a common production line to build them at its Tucson facilities. That allows for flexibility, scalability and cost savings for rapid output, the defense contractor said.

“Upgrades under this contract will allow us to increase speed and efficiency in production of these weapon systems that are integral to the defense of the U.S. Navy and our allies,” said Kim Ernzen, president of Naval Power at Raytheon, in a statement. “It’s also a very important step forward for our international customers, as this will be the first time that Standard Missile active radar technology will be fielded by the U.S.’s international allies.”

The deal is funded for the most part by foreign military sales. Besides the U.S., the updated missiles will be used by Canada, Australia, Japan and Korea.

The contract is the first of two for the missile upgrade program, covering work on the common missile subsections. Later in the year, a second award is expected for work to qualify the missiles and test the SM-2 Block IIICU at sea.

Raytheon is a division of Virginia-based defense contracting giant RTX (NYSE: RTX). Its Tucson operation is one of the largest defense contractors in Arizona.

The Standard Missile 6 has been getting other recent upgrades. Just last month, Raytheon announced that the latest software configuration for the SM-6 was successful against a medium-range ballistic missile during a Pacific Ocean test. The software configuration enhances the missile’s capabilities and makes it effective for anti-air, anti-surface and advanced ballistic missile defense at sea.

In an unrelated deal, the U.S. military announced one other new award earlier this month involving Raytheon’s Tucson operations. The $24,456,2000 contract modification will provide more tooling, equipment and labor for tactical Tomahawk missiles and related items for the Navy. Work under that award will take place in Tucson and is expected to be completed in October 2025.