The contract calls for 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 Japan.

The SM-3 Block IA provides upgrades to improve missile reliability and supportability at a reduced unit production cost. Launched from the USS Shiloh, the SM-3 Block IA intercepted a separating ballistic missile target on its first opportunity in June 2006.

Raytheon is also under contract to develop the SM-3 Block IB, which includes an advanced two-color infrared seeker and a throttling divert and attitude control system that improves the system effectiveness against longer range and more sophisticated ballistic missile threats.

"The Missile Defense Agency, the U.S. Navy and the government of Japan continue to have confidence in SM-3. This system continues to demonstrate Mission Assurance in test after test. We have seven hit-to-kill intercepts in total and five consecutive successful missions, including the Japan nosecone test," said Ed Miyashiro, vice president of Raytheon Missile Systems' Naval Weapon Systems. "This contract will enable us to increase our production rate, accelerate deliveries to the fleet and begin lowering the effective unit cost of the round."

SM-3 has transitioned from engineering development to the manufacturing phase and is being built along with production SM-2s in Raytheon Missile Systems' factories in Tucson, Ariz., and Camden, Ark. The SM-3 kinetic warhead (KW) is built and tested at a dedicated state-of-the-art Kinetic Kill Vehicle manufacturing facility in Tucson, which enables the company to incorporate the best of spacecraft quality and high-rate missile manufacturing expertise.

The SM-3 upper stage including third stage and KW also is integrated in Tucson before going to Camden for all up round integration.

Raytheon leads an integrated team that includes The Boeing Company, Aerojet and Alliant Techsystems. Work on SM-3 also is done in Anaheim and Sacramento, Calif., Camden, Ark., and Elkton, Md.

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