BAE Systems has secured a major five-year, $1.7 billion IDIQ contract from the U.S. Navy to continue high-volume production of the Advanced Precision Kill Weapon System (APKWS®) laser-guidance kits—one of the most widely used low-cost precision-strike solutions across U.S. and allied militaries. The contract includes an initial order of $322 million, marking one of the most significant commitments to the program since it entered full-rate production more than a decade ago.
The award underscores the growing requirement for cost-efficient, scalable precision-guided munitions (PGMs) as armed forces face increasingly complex multi-domain threats. The Navy’s decision to secure long-term production reflects not only operational demand but also the emphasis on maintaining an industrial base capable of rapidly delivering precision firepower at scale.
Strengthening U.S. Precision-Strike Capabilities
Under the new contract, BAE Systems will deliver tens of thousands of additional guidance kits, enabling the Navy, Marine Corps, Air Force, Army, and allied nations to convert standard 2.75-inch unguided rockets into accurate laser-guided munitions. This transformation turns legacy rocket inventories—traditionally used for area suppression—into surgical strike weapons that minimize collateral damage and operate effectively in contested environments.
Neeta Jayaraman, Director of Precision Guidance and Sensing Solutions at BAE Systems, emphasized the strategic importance of the award:
“This contract reinforces the value of a proven, cost-efficient system that delivers precision and flexibility across multiple platforms and mission sets. High-volume production ensures that U.S. and allied forces have reliable access to advanced guidance technology whenever they need it.”
APKWS: A Combat-Proven, Multi-Mission Precision Weapon
APKWS has become one of the most versatile precision weapons in the U.S. and allied inventory. Its modular guidance section is installed between the rocket motor and the warhead, transforming the munition into a guided weapon capable of striking moving or stationary targets with high accuracy.
Key Characteristics of the APKWS Guidance Kit
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Precision Strike Capability: Delivers pinpoint accuracy against soft and lightly armored targets.
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Platform Flexibility: Can be fired from rotary-wing aircraft (AH-1Z, MH-60), fixed-wing aircraft (A-10, F-16), unmanned aerial vehicles, ground launchers, and naval platforms.
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Mission Versatility: Effective in air-to-surface, surface-to-air, air-to-air, and surface-to-surface engagements.
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Low Collateral Damage: Ideal for urban warfare, counter-terrorism operations, and close air support missions.
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Cost Efficiency: A fraction of the cost of heavier PGMs like Hellfire or JDAM.
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Ease of Integration: Compatible with existing rocket motors, fuzes, and warheads, requiring minimal training and maintenance.
The system has seen extensive operational use in U.S. combat theaters, including counter-ISIS missions, maritime security operations, close air support in complex terrain, and partnered operations with allied militaries.
A Decade of Production and Proven Reliability
BAE Systems has been in full-rate production of APKWS guidance kits for more than 12 years. During this period, the system has become a mainstay of U.S. precision-strike doctrine, offering commanders a reliable and affordable option to complement more expensive munitions.
The company’s ability to maintain a robust supply chain—even during global disruptions—has been a key factor in the sustained success of the program. BAE Systems’ proven manufacturing processes ensure rapid output, high quality, and consistent on-time delivery to U.S. forces.
BAE Systems and the U.S. Navy: A Longstanding Strategic Partnership
The award further strengthens the long-standing relationship between BAE Systems and the U.S. Navy, which spans decades of collaboration in advanced weapons, sensors, electronic warfare, ship modernization, combat systems integration, and precision guidance technologies.
BAE Systems is a major supplier of:
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Naval gun systems (including the Mk 45 gun system)
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Electronic warfare suites
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Ship repair services
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Combat vehicle modernization
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Advanced microelectronics and sensor technologies
The company plays a critical role in supporting U.S. naval readiness across multiple domains—from the surface fleet to naval aviation and integrated air-defense systems.
BAE Systems’ Footprint in the United States
BAE Systems operates an extensive industrial network across the U.S., employing more than 20,000 personnel in engineering, manufacturing, technology development, and defense production. The APKWS guidance kits are manufactured in two major facilities:
- Hudson, New Hampshire
A center of excellence for precision-guidance technologies, microelectronics, and aerospace systems assembly.
- Austin, Texas
A high-capacity production site specializing in advanced manufacturing, scalable assembly lines, and rapid delivery for high-demand defense programs.
These facilities draw upon a broad U.S. supply chain that includes hundreds of small- and medium-sized manufacturers, reinforcing the domestic defense industrial base and supporting American jobs.
Meeting Global Demand for Affordable Precision Weapons
Beyond the U.S., APKWS is increasingly being adopted through Foreign Military Sales (FMS) programs, especially by nations seeking scalable precision capabilities without investing in expensive next-generation weapon systems.
The system’s simplicity, reliability, and affordability make it attractive to partners in the Middle East, Europe, Asia-Pacific, and Africa—particularly for counter-terrorism, border security, and urban operations.
As global demand increases, the U.S. Navy’s contract ensures production stability and long-term availability for allied customers.
