RTX’s Raytheon Secures Up to $20.7 Billion AMRAAM
Contract as European Air Defence Demand Grows
AeroMorning – John Smith – September 29, 2026
Raytheon, an RTX business, has been awarded a five-year,
multi-year contract worth up to $20.7 billion by the U.S. Department of War to
accelerate production of the AIM-120 AMRAAM, with annual output targeted at at
least 1,900 missiles. The agreement also includes two option years. The
agreement remains subject to Congressional funding approval.
RTX announced the contract in an official press release
dated September 28, 2026, titled “RTX’s Raytheon awarded $20.7 billion
multi-year contract for AMRAAM under landmark production agreement.” According
to RTX, the new agreement is part of the Department of War’s Arsenal of Freedom
initiative and follows earlier agreements aimed at increasing production of
critical munitions.
RTX said it had already nearly doubled AMRAAM production in
2025 compared with 2024 and is continuing to invest in its workforce,
technology, supply chain and manufacturing facilities to meet growing demand
from the U.S. military and international customers.
A high-end interceptor with a range measured in the
hundreds of kilometres
The AMRAAM (Advanced Medium-Range Air-to-Air Missile) is an
active radar-guided, beyond-visual-range air-to-air missile. Depending on the
variant and engagement conditions, its range is generally understood to be in
the 160-kilometre-plus class.
The missile is now in its fifth generation. According to
RTX, AMRAAM operates on 14 platforms in 44 countries and has achieved more than
7,000 successful live firings in testing and combat.
AMRAAM is used by fighter aircraft, but it also has a second
major role: it serves as the primary interceptor for the NASAMS ground-based
air-defence system, developed jointly by KONGSBERG and Raytheon.
The economics of high-end interception
The scale of the new production programme also highlights
the economic value of modern air-defence interceptors. The $20.7 billion figure
should not be treated as a simple unit price, since the agreement covers a
multi-year production programme and includes two option years.
Nevertheless, AMRAAM is a high-value interceptor compared
with many systems being developed specifically to counter drones and other
lower-cost aerial threats.
This difference in cost is increasingly important as armed
forces face the prospect of large numbers of relatively inexpensive drones
being used alongside more sophisticated aircraft and missiles. In a layered
air-defence architecture, there is therefore an economic rationale for using
high-end interceptors such as AMRAAM selectively against threats that justify
their range, speed and guidance capabilities.
Less expensive guns, electronic-warfare systems, short-range
interceptors and other specialised counter-UAS solutions can instead be used
against smaller or less demanding aerial targets.
The objective is not to replace AMRAAM, but to avoid using
an expensive long-range interceptor when a less costly system can provide the
required defensive effect.
A direct link with Europe’s growing NASAMS market
This issue is particularly relevant to Europe, where NATO
countries are expanding their ground-based air-defence capabilities.
KONGSBERG and Raytheon are the industrial partners behind
NASAMS, combining KONGSBERG’s command-and-control and networked air-defence
architecture with Raytheon’s interceptor technology.
A growing transatlantic air-defence ecosystem
The September 28 AMRAAM contract therefore extends beyond
the U.S. fighter-aircraft market. Its production expansion also supports the
wider industrial ecosystem of allied air-defence users.
For Raytheon, the agreement provides the framework for a
major increase in AMRAAM output. For KONGSBERG, greater availability of the
missile supports the international expansion of NASAMS. For European operators,
the combination of high-performance missile interceptors with specialised and
potentially lower-cost counter-drone systems offers a way to build layered
air-defence capabilities against increasingly diverse aerial threats.
