Lockheed (LMT) Wins $957M Deal for the Prototype Phase of NGAP
Lockheed Martin Corporation LMT recently clinched a contract to carry out the prototype phase of the Next Generation Adaptive Propulsion (“NGAP”) program. The deal was awarded by the Air Force Life Cycle Management Center, Wright-Patterson Air Force Base, O.
Details of the Deal
Valued at $957 million, the contract is expected to be complete by Jul 11, 2032. The contract involves technology maturation and risk-reduction activities through design, analysis, rig testing, prototype engine testing and weapon system integration.
The work involved will further contribute to delivering capability, enabling propulsion systems for future air dominance platforms, and digitally transforming the propulsion industrial base. The work related to the deal will be performed in Palmdale, CA.
Rationale Behind the Deal
The contract is part of the U.S. Defense Department’s goal to expand the adaptive engine market. Hence, it is imperative to mention that adaptive engines equipped with advanced technologies play a critical role in the proper functioning of fighter jets.
Additionally, these include a third stream of air flow that aims at improvising propulsive efficiency and low fuel burn. Further, these are also designed to provide additional air flow through the core for higher thrust and cooling air.
Against this backdrop, the need to upgrade and improvise the F-35 with an advanced and cutting-edge technology engine, which will enhance the overall functionality of the fighter jet, has been in talks lately amid the increased geopolitical tension.
In this regard, the Department of Defense (“DOE”) has been contemplating options to equip the stealth aircraft with advanced engine capabilities and has awarded five companies in the defense landscape to develop the prototypes of the engine. The latest contract win by LMT aligns with DOE’s current plans.
Peer Involvement
Apart from Lockheed Martin, the U.S. Air Force also awarded contracts to companies, namely General ElectricGE, Raytheon Technologies’ RTX Pratt & Whitney and Northrop Grumman NOC, to develop the prototypes of an adaptive engine.
In this context, it is imperative to mention that General Electric and RTX’s Pratt & Whitney as part of the Adaptive Engine Transition Program have already come up with advanced prototypes.
The prototypes developed by GE and RTX’s Pratt & Whitney will excel in providing a 25% improvement in fuel usage coupled with a 30% augmentation in range. These also boast twice the power and thermal management capability compared with the current military propulsion systems.
Meanwhile, Northrop Grumman’s Aeronautics Systems, which is yet to come up with the prototype of the F-35 future engine, currently produces propulsion systems for the company-built Ground-based Midcourse Defense interceptor and the Trident II D-5 and Minuteman III strategic missiles.
Northrop Grumman’s efficiency in providing propulsion systems can also be gauged by the application of its five segment boosters for NASA’s Space Launch System and the main launch-abort motor and the attitude control motor for the Orion Crew Vehicle’s Launch Abort System.
With alternative options to power and upgrade the future F-35 engine, the most cost-effective propulsion system might be chosen by the DOE before any engine reaches the final production line.
Price Movement
In the past year, shares of LockheedMartin have rallied 24.1% against the industry’s fall of 29.1%.
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Zacks Rank
Lockheed Martin currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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