US Navy Awards Kratos 61 Million Dollar Contract for BQM-177A Aerial Targets

US Navy Advances Aerial Target Fleet with Kratos Contract

The Kratos BQM-177A Surface Launched Aerial Target program has received a major funding boost as the US Navy awards Kratos Unmanned Aerial Systems Inc. a 61,068,139 dollar contract modification for full rate production. The award supports weapons system test and evaluation and fleet training across the Navy, reinforcing the service’s ability to simulate advanced airborne threats in realistic operational environments.

Naval Air Systems Command confirmed the award on Feb. 3, 2026. The modification exercises options under a previously awarded firm fixed price contract and covers production of Lot Seven BQM-177A targets, along with 70 rocket assisted takeoff attachment kits and associated technical and administrative data.

Kratos, based in Sacramento, California, is a long standing supplier of high performance unmanned target systems to the US Department of Defense. The BQM-177A is a key element in Navy test and evaluation infrastructure, enabling air defense units, fighter squadrons, and ship crews to train against realistic, high speed aerial threats.

Full Rate Production Lot Seven Details

The latest contract modification authorizes full rate production of the seventh manufacturing lot of the BQM-177A Surface Launched Aerial Target. The system is designed to replicate a wide range of threat profiles, including cruise missile like targets, to support live fire exercises and system validation.

According to Navy contract documentation, the award includes
• BQM-177A aerial targets
• 70 rocket assisted takeoff attachment kits
• Technical data and administrative support materials

These assets will be used across multiple Navy programs focused on air defense, missile interception, and sensor performance evaluation.

The Kratos BQM-177A Surface Launched Aerial Target is launched from ground based systems and is recoverable, allowing for repeated use and cost effective training cycles. Its performance envelope enables operators to stress radar systems, command and control networks, and interceptor weapons under realistic conditions.

Workshare and Industrial Footprint

Contracted work will be distributed across a broad US industrial base, supporting multiple states and defense manufacturing hubs. The Navy outlined the following workshare allocation

Sacramento, California accounts for approximately 50 percent of the effort.
Dallas, Texas supports about 20 percent.
Fort Walton Beach, Florida contributes 5 percent.
Blacksburg, Virginia supports 4 percent.
Santa Ana, California provides 2 percent.
Newton, Kansas provides 2 percent.
Concord, California supports 2 percent.
Milwaukie, Oregon contributes 2 percent.
Chatsworth, California accounts for 2 percent.
Various continental US locations make up the remaining 11 percent.

Work under the contract is expected to continue through August 2028, aligning with Navy planning cycles for weapons testing and fleet readiness activities.

Funding Profile and Fiscal Breakdown

The contract modification obligates funding across three fiscal years under the Navy Weapons Procurement account. The funding breakdown is as follows

Fiscal year 2024 funds total 872,402 dollars.
Fiscal year 2025 funds total 3,489,608 dollars.
Fiscal year 2026 funds total 56,706,129 dollars.

The Navy noted that 872,402 dollars will expire at the end of the current fiscal year. All funds are obligated at the time of award.

The contract was not competed, reflecting the specialized nature of the BQM-177A system and Kratos’ established role as the program’s prime contractor.

Role of BQM-177A in Navy Training and Test Missions

The Kratos BQM-177A Surface Launched Aerial Target plays a critical role in validating US Navy combat systems. It supports testing of
• Ship based air defense systems
• Surface to air missile interceptors
• Fighter aircraft weapons and sensors
• Integrated air and missile defense architectures

As potential adversaries continue to invest in more capable cruise missiles and unmanned systems, realistic target drones are essential to maintaining US technological and operational advantages.

By fielding full rate production Lot Seven assets, the Navy ensures continued availability of high fidelity targets for both developmental testing and operational fleet training.

Kratos and the Broader Unmanned Systems Portfolio

Kratos Unmanned Aerial Systems Inc. has become a central player in the US military’s unmanned ecosystem, supplying target drones and tactical unmanned aircraft across multiple services. The BQM-177A program complements the company’s broader portfolio, which includes jet powered targets and attritable unmanned combat aircraft concepts.

While this award focuses strictly on aerial targets, it underscores the Pentagon’s continued reliance on industry partners to sustain test and evaluation capacity as new weapons and sensors enter service.

Naval Air Systems Command, headquartered at Patuxent River, Maryland, serves as the contracting activity for the program.