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Lockheed Missile-Defense System Parts to Be Made in Saudi Arabia

Lockheed Missile-Defense System Parts to Be Made in Saudi Arabia

Components for Lockheed Martin Corp.’s Thaad missile-defense system sold to Saudi Arabia will be built locally to develop the kingdom’s defense industry.

Under the agreement, interceptor launchers and canisters for the so-called Terminal High Altitude Area Defense batteries will be manufactured in Saudi Arabia, the kingdom’s military industry regulator and the U.S. defense group said in a joint statement. They didn’t give an exact time frame for production.

Lockheed Missile-Defense System Parts to Be Made in Saudi Arabia

The announcement was made at Saudi Arabia’s inaugural World Defense Show, where Riyadh this week is showcasing efforts to boost local manufacturing. 

Currently one of the biggest buyers of foreign arms, Saudi Arabia wants to localize more than 50% of expenditure on defense equipment and services by 2030 as part of a broad economic plan. That means global arms companies and their governments must weigh up doing business with the kingdom’s defense industry with the sensitivities of transferring production to a foreign country. 

“This announcement will significantly boost global and regional security while supporting job creation and economic prosperity in Saudi Arabia,” Joseph Rank, chief executive for Lockheed Martin in Saudi Arabia and Africa, said in the joint statement.

Saudi Arabia is one of several countries which has bought the Thaad system that can intercept short- and medium-ranged ballistic missiles at higher altitudes than older systems such as the Patriot batteries used across the region. 

Thaad was first used in combat in Saudi Arabia’s neighbor, the United Arab Emirates, earlier this year when it destroyed missiles fired by Iranian-backed Houthi rebels that have targeted both countries for their involvement in the war in Yemen.  

The sale of U.S. military equipment to Saudi Arabia has been a contentious political issue in Washington under both the Trump and Biden administrations, largely due to the long-running war in Yemen where a Saudi-led coalition is battling the Houthis. 

©2022 Bloomberg L.P.