Department of War Announces $1B Direct-to-Supplier Investment to Secure U.S. Solid Rocket Motor Supply Chain
The U.S. Department of War (DoW) announced a $1 billion direct-to-supplier investment today to strengthen the U.S. solid rocket motor supply chain, marking a key shift in defense acquisition and industrial base strategy.
Officials said the funding represents a convertible preferred equity stake in L3Harris Technologies’ Missile Solutions business, which will spin out as a separate entity under this model. The move is designed to expand production capacity for propulsion components essential to major U.S. missile and munitions programs.
Modernizing the Supply Chain
The investment supports the DoW’s broader Acquisition Transformation Strategy, which aims to reduce single points of failure and improve industrial base resiliency by investing directly in critical suppliers, rather than relying solely on traditional contract awards.
Under the agreement, the DoW will anchor long-term procurement discussions with the new company, seeking multi-year agreements for solid rocket motors that underpin systems such as PAC-3, THAAD, Tomahawk, and Standard Missile families.
Strategic Rationale
Solid rocket motors are fundamental to a range of U.S. defense capabilities, yet production historically has faced capacity constraints and supply chain vulnerabilities. By leveraging direct investment tools, the DoW intends to decrease dependency on traditional transactional procurement, smooth production scaling, and shorten timelines to field critical components.
“We are fundamentally shifting our approach to securing our munitions supply chain,” said Under Secretary of War for Acquisition and Sustainment Michael Duffey. The direct-to-supplier model is intended to help rebuild U.S. stockpiles and strengthen deterrence by ensuring component availability.
Industrial Base Impacts
The initiative brings the DoW into a strategic investor role, potentially aligning government and industry incentives around expanded domestic capability and long-term production stability. This approach reflects broader efforts within the defense sector to address persistent supply chain shortfalls and production bottlenecks that have emerged across munitions and propulsion systems.
Bottom Line
The $1 billion direct investment underscores a significant evolution in how the Department of War engages with domestic suppliers to enhance the industrial base for critical defense components. By backing L3Harris’ Missile Solutions unit with convertible preferred equity, the DoW aims to secure and expand solid rocket motor production capacity to meet current and future defense requirements.
Get real time update about this post category directly on your device, subscribe now.
