Accelerate Production by Modernizing Acquisition

Introduction

The threats facing the United States and its allies today demand more than incremental improvements to defense capacity—they require a fundamentally different model for how the U.S. government buys weapons at scale. Russia’s ongoing war in Ukraine, the conflict in the Middle East, and China’s expanding military capabilities clearly demonstrate that the post–Cold War era industrial base approach no longer meets U.S. needs. Traditional annual acquisition cycles—characterized by short-term, unpredictable processes—have left the U.S. defense industrial base (DIB) underinvested and struggling to surge when the moment demands it. The good news is that a better model is emerging. The Trump administration’s framework agreement approach, which offers long-term, stable demand, provides industry the certainty needed to invest, hire, and produce at scale. Expanding and institutionalizing this model is one of the most consequential steps policymakers are taking to strengthen and future-proof American deterrence and warfighting capability.

Key Takeaways

• The new commercial procurement model allows the U.S. government to fund higher quantities of both tried-and-tested and new munitions.
• Multiyear framework agreements provide industry the long-term, stable demand signals needed to invest in new facilities, tooling, test equipment, workforce growth, and supply chain depth.
• Demand certainty drives supplier investment and bolsters job creation; when suppliers know what they will be asked to build over a sustained period, they can hire, train, and equip accordingly.
• Longer-term contracts incentivize accelerated production rates and unlock operational efficiencies, generating savings that government and industry can share.
• Increased upfront investment by industry provides savings to the taxpayer.

Acquisition Transformation Is Underway

The Department of War’s (DoW’s) Acquisition Transformation Strategy represents the most ambitious overhaul of U.S. defense procurement in a generation, and early results showcase what is possible when government and industry commit to a new model. In January 2026, Lockheed Martin (where I serve as the chief operating officer) and the DoW announced a landmark seven-year framework agreement to rapidly accelerate production and delivery of PAC-3 Missile Segment Enhancement (MSE) interceptors, more than tripling annual unit capacity. Weeks later, a similar deal was announced to quadruple the production capacity of Terminal High Altitude Area Defense (THAAD) interceptors. And, in late March 2026, Lockheed Martin and the DoW reached a framework agreement to quadruple production of the Precision Strike Missile (PrSM). The momentum is real—RTX and other industry partners have struck similar agreements with the DoW. Together, these agreements deliver long-term demand certainty, enable confident industry self-investment, and improve production efficiencies, while employing collaborative financing so companies don’t have to deploy significant capital at the outset, allowing industry to invest confidently to meet required production levels.

But these agreements didn’t emerge in a policy vacuum, and the urgency isn’t theoretical. Recent combat operations demonstrate the criticality of higher production rates. To maintain robust deterrence, the DIB needs production at scale. With the assurance of multiyear agreements, the DoW and industry partners can restock and expand missile capacity faster and more cost effectively than ever before.

When Industry Invests, America Wins

Framework agreements can only succeed if industry treats the Department of War’s demand signal as a genuine license to invest, and not just an occasion to produce incrementally more of what already exists. Strengthening the DIB requires parallel commitments: The government pledges long-term guaranteed funding, and industry commits capital, workforce, and supply chain depth to yield better production outcomes.

To support these ramp-ups, Lockheed Martin broke ground earlier this year on a state-of-the-art Munitions Acceleration Center in Camden, Arkansas, which is part of a broader three-year, multibillion-dollar investment to expand and accelerate capacity. Other recent investments include a new Munitions Production Center in Troy, Alabama, which will add production space for THAAD interceptors, and a new Missile Assembly Building in Courtland, Alabama, to produce the Next Generation Interceptor for the Missile Defense Agency. These are just a few of the more than 20 facilities Lockheed Martin is opening or upgrading this year.

The supply chain supporting these programs is equally important. With more than 13,000 suppliers, Lockheed Martin is safeguarding critical production lines by diversifying suppliers, adding dual-source options and insourcing where needed while continuously monitoring supplier networks to spot and correct bottlenecks before they impact production. For example, in partnership with General Dynamics, a new Solid Rocket Motor (SRM) facility is being built in Camden to increase domestic SRM production capacity and reduce dependency on limited sources. This would have otherwise been a direct investment in supply chain resilience that no annual contract cycle could have justified. Lockheed Martin, through research partnerships and investments from the $1 billion Lockheed Martin Ventures fund, is also working to bring new, nontraditional companies into the supply chain.

The connection is clear: Industrial investment aligns with demand certainty. When the government commits to a sustained production horizon, industry responds with the capital, workforce, and technology needed to deliver.

Industry Is Moving, but Congress Holds the Keys to the Car

Framework agreements between the DoW and defense contractors are necessary but not sufficient to accelerate production and expand capacity. Their promise can only be fulfilled if Congress provides the authorization and appropriations to fund the underlying contracts. Framework agreements establish intent; Congress provides authority and appropriations to make them a reality.

Congress has already taken meaningful steps through the fiscal year (FY) 2026 National Defense Authorization Act (NDAA) and the FY 2026 Department of Defense Appropriations Act. The NDAA updates the threshold for mandatory submission of certified cost or pricing data, which reduces the administrative burden on suppliers and the government. It also expands preferences for commercial products and services, recognizing that commercial innovation may be rapid and that more flexible acquisition models may allow the DoW to access cutting-edge technology with each iteration of improvement. These are the right instincts, pursued at the right moment.

Recommendations

• The DoW should continue to expand its framework agreement model approach beyond munitions to encompass other critical capability areas such as aircraft, sensors/radars, and critical minerals.
• The DoW and Congress must continue collaborating to authorize multiyear procurement and appropriate funds for these framework agreements.
• In overhauling defense acquisition, Congress should continue efforts began last year to meaningfully overhaul the Federal Acquisition Regulation (FAR)/Defense FAR Supplement (DFARS) to significantly reduce procurement acquisition lead time and modernize the use of historical cost and pricing data, establish balanced intellectual property requirements and protections for both government and defense contractors, and systematically expand the share of commercial items throughout the supply chain to promote resilience.

Conclusion

Innovative acquisition frameworks, prioritizing long-term demand, enable industry to self-invest, accelerate production, and increase delivery of mission-critical capabilities. Recent agreements chart an agile course toward commercial models that can deliver tangible results. The policy infrastructure to sustain that movement—through reliable authorities, robust appropriations, and streamlined regulations—is the work that must continue while the industrial base moves out.

About the Author

Frank St. John is chief operating officer (COO) for Lockheed Martin, where he is responsible for the strategic, operational, and financial performance of the corporation’s four major business areas. Prior to serving as COO, St. John led the Rotary and Mission Systems business area and the Missiles and Fire Control (MFC) business area. Additional roles held at MFC include executive vice president and deputy of programs, vice president of tactical missiles/combat maneuver systems, and general manager for the MFC Orlando campus. St. John graduated from the University of Central Florida with bachelor’s and master’s degrees in electrical engineering.

About the New American Industrial Base Series

This essay series, The New American Defense Industrial Base, features expert practitioners with experience in government, industry, and finance writing on the most pressing challenges in defense acquisition today. For more in this series, click here. The DIB series is made possible by general support to the CNAS Defense Program and corporate support for the series.

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