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Northrop, Lockheed Receive $1.6B in MDA Contracts for Next Generation Interceptor Program

The Missile Defense Agency has awarded $1.6 billion in contracts through fiscal year 2022 to Northrop Grumman (NYSE: NOC) and Lockheed Martin (NYSE: LMT) to conduct technology development and risk reduction work on the Next Generation Interceptor program.

MDA received three proposals for the contracts and is obligating $291.9 million in research and development funds for FY 2021, the Department of Defense said Tuesday.

NGI is part of the ground-based midcourse missile defense system and seeks to protect the U.S. against intercontinental ballistic missile threats.

Northrop and its partner Raytheon Technologies’ (NYSE: RTX) missiles and defense business will perform work in Chandler, Arizona, and Huntsville, Alabama, through May 2026. The contract has a total value of $3.93 billion, including option periods.

Lockheed will work with Aerojet Rocketdyne (NYSE: AJRD) on the contract, which has a maximum value of $3.7 billion, through August 2025. Contract work will occur in Huntsville and Sunnyvale, California.

Stacy Cummings, acting undersecretary of defense for acquisition and sustainment and a 2021 Wash100 winner, said NGI plays a critical role in homeland defense and the awards mark an important step in the missile defense system modernization effort.

“By planning to carry two vendors through technology development, MDA will maximize the benefits of competition to deliver the most effective and reliable homeland defense missile to the warfighter as soon as possible. Once fielded, this new homeland defense interceptor will be capable of defeating expected threat advances into the 2030s and beyond,” said Vice Adm. Jon Hill, director of MDA.

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