Raytheon’s Standard Missile Naval Defense Family: FY 2006 Contracts
Variants of the SM-2 Standard missile are the USA’s primary fleet defense anti-air weapon, and in service with 13 navies worldwide. The most common variant is the RIM-66K-L/ SM-2 Standard Block IIIB, which entered service in 1998. It includes a number of modifications over previous versions, including greater capability at even lower altitudes, a more powerful fragmentation warhead, and a side-mounted infrared seeker developed in the Missile Homing Improvement Program (MHIP) to supplement the missile’s semi-active radar guidance system. These missiles work best when paired with the AEGIS radar and combat system, but can be employed independently.
For coverage of the Standard Missile family beyond FY 2006, turn to this DID FOCUS Article.
The Standard Missile Naval Defense Family: Budgets, Missiles, and Plans

The USA has budgeted a total of $289.4 million for its Standard family of naval air defense missiles in FY 2006, a slight rise from the $259.3 million in FY 2005. This family also includes the SM-3 extended range missile that can also used in a ballistic missile defense role, and the next-generation SM-6 Standard Extended Range Active Missile (ERAM) which is still in development.
The SM-1 was phased out of US service in 2003, but still serves with some allied navies; most US and international orders are currently SM-2s. The 75 SM-2 Block III missiles noted in the February 15, 2006 contract are the usual annual purchase listed in Pentagon budget documents. Unlike the 2005 purchase, this year’s American order stands alone rather than being part of a larger multi-national order.
The FY 2006 budget for Standard missile family RDT&E (Research, Development, Testing & Evaluation) has risen to $145.6 million, however, from $110.6 million in FY 2005. This should allow more intensive work on the SM-3 ABM variant, aka. RIM-161A. It uses the RIM-156 (SM-2 Extended Range Block IV) test program’s airframe and propulsion/booster, then adds a third-stage rocket motor (a.k.a. Advanced Solid Axial Stage, ASAS, made by ATK), a GPS/INS guidance section (a.k.a. GAINS, GPS-Aided Inertial Navigation System), and a LEAP (Lightweight Exo-Atmospheric Projectile) kinetic warhead (i.e. a non-explosive hit-to-kill maneuvering warhead).
The launching ships, usually CG-47 Ticonderoga Class cruisers or Japanese Kongo Class destroyers, are updated with AEGIS LEAP Intercept (ALI) computer software and hardware, as well as the Long Range Surveillance and Track (LRS&T) AEGIS enhancements that will be implemented across all AEGIS ships that take the upgrade. When used in conjunction with the USA’s Co-operative Engagement Capability components, the result is a single integrated “picture” available to all CEC-equipped ships in the area – a picture that can even be used to help guide long-range anti-air missiles launched from other ships.
This SM-3/AEGIS LEAP combination plays a prominent role in near-term US and Japanese missile defense plans. These interceptors have a better record in ABM tests than their land-based counterparts to date, and their naval mobility makes them well suited for forward defense. The SM-3 Block IA version provides an incremental upgrade that improves reliability and maintainability at a reduced cost. SM-3 Block IB upgrades include an advanced two-color infrared seeker, and a throttling divert and attitude control system (TDACS) for its kinetic warhead that gives it improved capability against maneuvering ballistic missiles or warheads. TDACS is a joint Raytheon/Aerojet project.
More significantly, the SM-3 has transitioned from engineering development to manufacturing build process and is being built along with production SM-2s in Raytheon Missile Systems’ factories in Tucson, AZ, and Camden, AR. The SM-3 kinetic warhead (KW) is built and tested at a state-of-the-art kill vehicle manufacturing facility in Tucson, AZ, and the entire upper stage including KW and third stage also is integrated in Tucson before going to Camden, AR for all up round integration. Work on SM-3 also is done in Anaheim, CA; Sacramento, CA; and Elkton, MD. Raytheon leads an integrated team that includes The Boeing Company, Aerojet and Alliant Techsystems.
The SM-6 ERAM will also continue development per the $440 million multi-year SDD contract signed September 3, 2004. That contract expires in 2011, which means the SM-6 ERAM is unlikely to reach active procurement status before 2013. Present plans call for the ERAM to replace the SM-2 missiles – note that it may not have a theater ballistic missile defense role like the SM-3.
The Standard Missile Naval Defense Family: US Contracts & Events

Unless otherwise specified, all contracts are issued to Raytheon Co. in Tucson, AZ, at the request of the US Naval Sea Systems Command.
With respect to Japan, note that the USA and Japan are working together on missile defense, with SM-3 missiles as Japan’s outer layer and Patriot PAC-3s as the point defense component.
August 16/06: A $265.9 cost-plus-award/incentive fee contract modification for 29 SM-3 Block IA missiles to be produced for the United States and Japan and for flight test support, engineering activity, system upgrades and continued cooperative research and development work with the US Missile Defense Agency and Japan. The initial delivery order is for $168 million. Work will be performed in Tucson, AZ and is expected to be complete by December 2009 (N00024-03-C-6111). The Japanese order may well be releated to the June 5-6, 2006 item, below.
August 4/06: An $8 million modification to previously awarded contract (N00024-06-C-5350) for FY06 SM-2 Block IIIB, post-production spares, and FY04 SM-2 common production spares to support of maintenance and repair of shipboard missiles. Work will be performed in Tucson, AZ (83%); Andover, MA (14%); Camden, AZ (2%); and Farmington, NM (1%), and is expected to be complete by December 2008.
June 23/06: As North Korea prepares to test-launch a Taepodong-2 ballistic missile reportedly capable of hitting the US mainland, the US & Japan successfully conducted a joint missile intercept test off of Hawaii using the USS Shiloh [CG 67] guided missile cruiser and its upgraded AEGIS radar & combat system, firing an SM-3 missile. Three AEGIS destroyers also participated, including a Japanese Kongo Class destroyer. The test was the 7th successful intercept in 8 tests during the current program. See Navy News article for details.
June 8/06: Boeing has delivered the first Block 1A Standard Missile-3 Kinetic Warhead (SM-3 KW) to Raytheon. Boeing has been partnered with Raytheon on the SM-3 program since 1996, and is under subcontract to integrate and test the KW hardware. They are responsible for the KW avionics, guidance and control hardware and software, as well as the ejection subsystem. In addition to SM-3 round integration, Raytheon provides the KW infrared seeker, signal and image processor, and the integrated KW software. See corporate release.
June 5-6/06: The US Defense Security Cooperation Agency notified Congress of a pair of requests from Japan for Standard-family naval air and missile defense systems. The total value, if all options are exercised, could be as high as $528 million. Raytheon, Lockheed, and BAE are the primary contractors.
The first sale for $458 million involves 9 longer-range SM-3 missiles plus ballistic missile defense upgrades to one AEGIS Weapon System, AEGIS BMD Vertical Launch System (VLS) alternations, and other support. The second sale is for $70 million if all options are exercised, and involves up to 44 shorter-range SM-2 Block IIIB Standard Missiles that serve as the mainstays of the Kongo Class AEGIS destroyers’ air defense, plus various forms of support.
May 26/06: Raytheon Missile Systems, Tucson, Ariz., is being awarded an estimated $424 million cost-plus-award fee contract modification (N00024-03-C-6111). It covers the continued systems engineering, design, development, fabrication, and testing of Standard Missile-3 (SM-3) Block IA and IB Missiles for the AEGIS Ballistic Missile Defense Program being conducted by the USA, with some cooperation from Japan. Work will be performed in Tucson, AZ and is expected to be complete by May 14, 2008. Initial funding of $96 million has been issued to support engineering services, engineering studies and technology development technical instruction efforts. See June 7, 2006 corporate release.
April 5/06: A Raytheon Company Standard Missile-2 (SM-2) Block IV with control systems upgrades was successfully flight tested against a subsonic target at White Sands Missile Range, NM on Feb. 16, 2006. The SM-2 Block IV upgrade includes a new steering control section, new thrust vector actuator assembly for the boost rocket motor and a new primary missile battery as well as upgrades to the guidance and control software. The upgrade was completed as part of a value engineering project at Raytheon Missile Systems in Tucson, AZ, and “will result in a significant cost reduction” by making the missiles more reliable and easier to produce. Raytheon also notes that these improvements will be applied across the Standard missile family to the SM-3 and SM-6 as well.
March 27/06: A $9 million modification to previously awarded contract N00024-04-C-5344 exercises an option for engineering and technical services to support the STANDARD missile-6 (SM-6) program. Engineering & technical services include initial performance studies, conceptual design studies, functional design, preliminary design, detailed design and development and round integration studies for potential future improvements. The Contractor shall also provide design assessments as necessary for current improvements. Work will be performed in Tucson, AZ (80%); Camden, AK (15%); and Andover, MA (5%), and is expected to be complete by December 2011.
Feb 27/06: $17.8 million modification to previously awarded contract (N00024-06-C-5350) exercises the United States option for the procurement of the FY06 STANDARD Missile-2 BLOCK IIIB Spares. Work will be performed in Tucson, AZ (83%); Andover, MZ (14%); Camden, AK (2%); and Navajo Agricultural Products Industries (NAPI) in Farmington, NM (1%), and is expected to be complete by December 2008.
Feb 15/06: Raytheon Co. in Tucson, AZ received a $122.2 million modification under a previously awarded contract (N00024-06-C-5350), exercising an option for FY 2006 production of 75 Standard Missile-2 Block IIIB All-Up-Rounds (AUR), 80 SM-2 Block IIIB Service-Life Extension Program (SLEP) Retrofits, and 125 AN/DKT-71A Telemetric Data Transmitting Sets (TDTS) with installation kits. The contract modification will also provide for royalties associated with AUR and SLEP equipment. Work will be performed in Tucson, AZ (83%); Andover, MZ (14%); Camden, AK (2%); and Farmington, NM (1%), and is expected to be complete by December 2008.
See also the May 4 Raytheon release. Note that “all-up-rounds” include the missile, its launch container, and related equipment that allows for rapid installation of the naval missiles in vertical launch systems.
Feb 15/06: A $7.9 million option under another previously awarded Raytheon contract (N00024-01-C-5306) to provide FY 2006 Depot Level Maintenance Facility work in support of Standard Missile 2 (SM-2), Guided Missile Program. Work will be performed in Tucson, AZ (100%), and is expected to be complete by the end of September 2006 – which is also the end of the US Defense Department’s fiscal year.
The Standard Missile Naval Defense Family: Foreign Military Sales
Unless otherwise specified, all contracts are issued to Raytheon Co. in Tucson, AZ, at the request of the US Naval Sea Systems Command. See also the section above, as the USA and Japan are listed as cooperating partners on several contracts.
June 26/06: The US Defense Security Cooperation Agency notified Congress of South Korea’s request for 48 SM-2 Standard Block IIIB missiles, as well as Mk 13 Mod 0 canisters for vertical launcher systems, containers, Intermediate-Level Maintenance spares and repair parts, supply support, personnel training and training equipment, publications and technical data, U.S. Government and contractor technical assistance and other related elements of logistics support. The total value, if all options are exercised, could be as high as $111 million.
Korea already uses SM-2 missiles aboard some of its ships, and these SM-2 are slated for use as the primary defensive system aboard its new KDX-III AEGIS destroyers. Industrial offset agreements are expected but not yet defined. See DSCA release [PDF].
June 6/06: a $70 million sale to Japan of 20 SM-2 Block IIIB missiles, 24 SM-2 Block IIIB Telemetry missiles and AN/DKT-71A telemeters, conversion kits and containers, spare and repair parts, et. al. Multiple contractors are involved.
June 5/06: A $458 million sale to Japan of 9 SM-3 Block IA Standard missiles, plus ballistic missile defense upgrades to one AEGIS Weapon System, AEGIS BMD Vertical Launch System (VLS) alternations, containers, spares, and support. Multiple contractors aree involved.
April 6/06: Raytheon Co. in Tucson, AZ received a $29.5 million cost-plus-award-fee modification to previously awarded contract N00024-03-C-5330. This provide for engineering and technical services in support of the Standard Missile 2 (SM-2) Guided Missile Program for foreign military sales for the countries of Taiwan (66.2%) and Korea (33.8%) under the Foreign Military Sales Program. Work will be performed in Tucson, AZ and is expected to be complete by March 2007.