On March 6, the president convened CEOs from Northrop Grumman and six other defense primes at the White House and secured commitments to quadruple production of “Exquisite Class” precision-guided munitions. The group agreed that expansions initiated in December across multiple plants will accelerate output to the highest feasible levels.

Lockheed Martin has already agreed to boost PAC-3 interceptor output from 600 to 2,000 units annually under a seven-year Pentagon deal and to quadruple THAAD missile production to 400 per year, illustrating the scale of planned capacity increases among prime contractors.

The ramp-up follows heavy U.S. munitions usage in recent operations against Iran and in Venezuela, with executives noting a “virtually unlimited supply” of medium- and upper-medium grade rounds. This initiative aims to replenish stockpiles depleted since 2022 conflicts in Ukraine and Middle East operations.

Defense stocks traded mixed following the announcement as investors weighed the boost in long-term order prospects against existing backlogs and geopolitical risks. Oil surged above $90 per barrel with Strait of Hormuz disruptions intensifying supply concerns that may further reshape defense spending priorities.