Raytheon Tops Lockheed Martin for $10 Billion Cruise Missile Contract

On April 17, the U.S. Air Force ended the competition to develop a new Long-Range Standoff Weapon (LRSO) nearly two years early, declaring Raytheon Technologies (NYSE: RTX) the winner of a contract expected to be worth as much as $10 billion if the program is fully developed.

In August 2017, the Air Force awarded what was then Raytheon and Lockheed Martin (NYSE: LMT) separate $900 million contracts to continue work on the LRSO, an air-launched cruise missile designed for both nuclear and conventional attacks. The companies were supposed to spend four-plus years continuing its development, with the Air Force not expected to down-select to a final vendor until fiscal 2022.

The award is a nice prize for Raytheon Technologies, which was formed just this month when defense contractor Raytheon merged with the aerospace arm of United Technologies. It also raises questions about why the announcement came when it did, and what it means for the program.

Source Fool.com