Elodie Collins 
Lockheed Martin has entered into a seven-year framework agreement with the Department of War to accelerate the production of the Patriot Advanced Capability-3, also known as PAC-3, Missile Segment Enhancement, or MSE, interceptor from roughly 600 units per year to approximately 2,000.
The expanded capacity will support U.S. forces and allied and partner nations amid growing global demand for advanced air and missile defense capabilities, Lockheed Martin said Tuesday.
“We will create unprecedented capacity for PAC-3 MSE production, delivering at the speed our nation and allies demand while providing value for taxpayers and our shareholders,” Jim Taiclet, chairman, president and CEO of Lockheed Martin and a two-time Wash100 winner, stated.
How Does the New Acquisition Model Change Production?
Under the agreement, DOW and the company will share in cost savings generated through volume efficiencies, new equipment investments and long-term demand certainty for PAC-3 MSE interceptors.
The Pentagon said it plans to apply the facilitization strategy to multiple munitions procurement contracts in the coming months to replenish the nation’s stockpiles and strengthen the capacity of the domestic defense industrial base.
“This framework agreement marks a fundamental shift in how we rapidly expand munitions production and magazine depth, and how we collaborate with our industry partners,” Michael Duffey, under secretary of war for acquisition and sustainment, commented.
Duffey will deliver his opening keynote speech at the Potomac Officers Club’s 2026 Defense R&D Summit on Jan. 29. The highly anticipated GovCon event will bring together top decision-makers and innovators from across the military and industry for insightful panel discussions and to forge new partnerships during networking sessions. Register here to secure your spot.
The agreement is a direct result of the Pentagon’s Acquisition Transformation Strategy unveiled in November.
What Is the PAC-3 MSE?
The PAC-3 MSE is an interceptor designed to defeat incoming threats through direct hit, delivering more kinetic energy than traditional blast-fragmentation systems. The weapon system supports joint all-domain operations by integrating with the Terminal High Altitude Area Defense system, the Army’s Integrated Air and Missile Defense Battle Command System and the F-35 Lightning II fighter jet.
Global demand for PAC-3 MSE interceptors has surged following recent real-world operations, Lockheed Martin said. In 2025 alone, the company delivered 620 PAC-3 MSE interceptors—more than 20 percent higher than the previous year—and over 24,000 missiles and fire control products overall.
