Patriot vs. THAAD: BMD Radar Market Growth after Russia’s ICBM (IRBM) Strike

The World’s First Wartime ICBM/IRBM Attack

In November 2024, Russia fired a high-altitude 1,000+ km range “ICBM” (Inter-Continental Ballistic Missile) at Ukraine’s Yuzhmash engineering development and manufacturing facility in Dnipro – ironically, a legacy facility itself involved in the development and production of nuclear missiles for the USSR during Soviet times. This was the world’s first ever combat use of an armed “ICBM.” The new missile, referred to as the Oreshnik by Vladimir Putin, has been classified by the US DoD as an IRBM (Intermediate Range Ballistic Missile) developed out of the Russian RS-26 Rubezh ICBM.

While the Oreshnik did not have a nuclear payload(s), which it could have carried as can the RS-26 Rubezh, the new missile released multiple warheads at high altitude and cannot be fully countered by the Patriot air defense missile system. To effectively counter IRBMs and ICBMs, interception and missile destruction must occur at a higher altitude and/or earlier in the missile’s flight profile – prior to multiple warhead release – by systems such as the US Army’s THAAD (Terminal High Altitude Area Defense).

Patriot Radar & C4I: Today’s Mobile Air Defense

The AN/MPQ-53 was the original primary engagement radar of the Patriot air defense missile system now deployed widely around the world for interception of lower-altitude single-warhead missiles. Today’s primary Patriot radar system, the AN/MPQ-65, is the upgraded radar developed to support the Patriot PAC-3 missile, with a new transmitter with double the power. Patriot is currently the world’s most successful, most widely serving ground-based mobile air defense missile system, with radars, missiles, and most systems manufactured by Raytheon for the US Army and export customers.

Japan and Germany have been involved in license production of the system, and the system has been sold to the Netherlands, Germany, Italy, Israel, Turkey, Saudi Arabia, Qatar, and many other nations. In April 2015, the Polish government chose a new, upgraded Patriot radar for its Wisla air defense missile requirement, in what could lead to worldwide upgrades for other Patriot users. When including letters of offer to Romania, Sweden, and Bahrain in 2017, 2018, and 2019, the number of international Patriot customers rose to at least 16 by 2020. The US Army has acquired about 104 MPQ-53 radars, with about 140 additional export radars produced by early 2016.

Increased interest in Ballistic Missile Defense (BMD), especially in Asia, the Middle East, and now Ukraine, indicate a significant potential market for PAC-3 systems and upgraded Patriot radar systems: sales picked up significantly in the 2010s. For example, in September 2020 Romania received its first shipments of the Patriot system as part of a $3.9 billion foreign military sale which is to include seven Patriot units, missiles, launching stations, spare parts, and training.

More recently, in April 2023 Raytheon Technologies was awarded a $1.2 billion foreign military sales contract from the US Army to provide Switzerland with the Patriot air defense system. The contract includes five Patriot fire units, 17 launch stations, and 70 MIM-104E GEM-T missiles.

In 2023, Ukraine was provided with one Patriot fire unit from Germany and one from the United States. The fire units have been deployed in the Kyiv area and some of their initial engagements proved capable of downing the Russian Kinzhal aero ballistic missile as well as other targets such as cruise missiles. The United States has committed to providing additional Patriot fire units to Ukraine.

In 2017, the Army initiated development of the next-generation Patriot radar, the Lower Tier Air & Missile Defense Sensor (LTAMDS), with huge planned funding and an aggressive schedule. In October 2017, four contracts were awarded for the technology maturation and risk reduction (TMRR) phase, to Raytheon, Lockheed Martin, Northrop Grumman, and Technovative Applications. The TMRR was planned to conclude in 3QFY22 with a Milestone B decision. But in October 2019, the US Army instead chose Raytheon, Waltham, MA, using an “other transaction authority” procedure to award a $384 million FFP contract to continue development for the “Prototype Manufacturing and Integration (Rapid Prototyping)” phase, covering delivery and test of six LTAMDS Radar prototypes over a three-year period. Raytheon’s LTAMDS radar would use a gallium nitride (GaN)-based active electronically scanned array (AESA) antenna.

In February 2020, the Army announced the LTAMDS sensor/radar set (RS) will initially replace the baseline Patriot RS (AN/MPQ-65A) in an IAMD enabled Patriot Battalion, and greatly increased funding – increased to $376.4 million in FY21 alone – would support further acceleration of the LTAMDS program.

In June 2023, the US Congress was notified of a letter of offer to Poland valued at $15 billion for an Integrated Air and Missile Defense (IAMD) Battle Command System (IBCS) in PATRIOT Configuration 3+ including 48 PATRIOT M903 Launch Stations; 644 PAC 3 MSE missiles; 12 Lower Tier Air and Missile Defense Sensors (LTAMDS); and associated equipment and support.

In March 2024, the US Army’s FY25 budget provided for thirty (30) LTAMDS radars funded from FY25-FY29 budgets at a cost of $4 billion.

In July 2024, the US Army obligated $815.9 million in combined FY24 FMS and RDT&E funding to begin a four-year, $2.1 billion award to Raytheon for LTAMDS LRIP, including delivering six production representative units for testing and other assessment activities.

Patriot radars and C4I will continue to compose one of the largest electronics markets in the world for at least the next decade – with most current and planned funding now to be funneled through Raytheon as prime contractor. Teal Group forecasts Patriot Radar and C4I funding rising from $2.3 billion in FY24 to a whopping $5.3 billion in FY33 – adding up to a massive $41.3 billion total over the next decade (and continuing). The scariest thing is that our forecasts are conservative. If LTAMDS unit cost remains as high as it is today, and large numbers of new radars are bought by FMS customers, funding totals could be 20-40% higher than these numbers.

THAAD Radar & C4I: Most Advanced Mobile Ballistic Missile Defense (BMD) System

The mobile system designed for expeditionary defense against missiles such as Russia’s Oreshnik is the THAAD (Terminal High Altitude Area Defense), a hypervelocity, anti-tactical ballistic missile system designed beginning in the late 1980s to defend large areas by defeating tactical ballistic missiles in the upper atmosphere. THAAD provides area defense in contingency operations and complements the shorter-ranged Patriot PAC-3 system.

THAAD was initially developed as a key element of the United States’ Terminal Defense Segment (TDS) of the Ballistic Missile Defense System (BMDS). The THAAD radar/missile system, in conjunction with the already-fielded Patriot radar/missile system, was to enhance the TDS by deepening, complementing, and extending the BMDS battlespace and capability to engage ballistic targets in the late mid-course and terminal phases of their trajectory.

The THAAD Radar (now designated AN/TPY-2) is an X-band phased-array system providing surveillance, detection, tracking, threat classification, and post-engagement analysis. It is transportable via C-5 and C-17 sorties. Until July 1995, the tactical surveillance radar intended for the THAAD program was an independent project, designated the Tactical Missile Defense Ground Based Radar (TMD-GBR) or Ground Based Radar (GBR).

The Command and Control/Battle Management Communications (C2BMC) system (was Battle-Management/Command, Control, Communications, and Intelligence [BM/ C3I]) is the larger, over-arching C4I system for the BMDS, to link THAAD to all other BMD elements.

The $4 billion THAAD EMD contract was finally awarded to Lockheed Martin after long delays in June 2000, closely followed by a $1.4 billion THAAD Radar subcontract in August 2000. But the program was substantially reorganized in FY03 and by 2015 – again after long and expensive delays – had been reorganized again. THAAD program objectives originally called for 1,422 THAAD missiles, 99 launchers, and 14 THAAD radars, at a program cost of about $16.9 billion.

In late 2006, a contract for the first two US Army Batteries was awarded to Lockheed Martin. The A-4 ADA Battery was activated in May 2008 at Fort Bliss, TX, with the A-2 ADA Battery activated in October 2009.

In March 2011, Lockheed Martin received a $789.8 million THAAD production contract, including $694.9 million to produce 48 THAAD interceptors (missiles), six THAAD launchers, four fire control units, and additional support equipment, with delivery originally to be completed in 2013. As of 2015, the US Army had activated five THAAD batteries and had received its 100th interceptor missile. The Army fielded the seventh battery in 2017.

By early 2016, production for the first THAAD foreign sale, to the United Arab Emirates (UAE), was also underway.

In October 2017, Congress was notified of a letter of offer to Saudi Arabia for 44 THAAD launchers, 360 THAAD Interceptor Missiles, 16 THAAD Fire Control and Communications (TFCC) Mobile Tactical Station Groups, seven TPY-2 THAAD radars, and associated equipment and support valued at about $15 billion.

In mid-2020, Saudi Arabia contracted for seven upgraded TPY-2 THAAD Radars for $2.3 billion, to be the first to incorporate Gallium Nitride (GaN) antenna technology to increase detection range and target discrimination (the US planned to eventually retrofit its radars with GaN modules). Saudi Arabia planned to operate seven of their own TPY-2 radars while the US would only operate 12 (seven based in the US and five at forward bases). The UAE also operates two TPY-2s.

In February 2022, a UAE THAAD battery intercepted a Yemeni ballistic missile, marking the first combat use of the system.

In October 2024, US Army Secretary Christine Wormuth discussed the THAAD battery now planned to be deployed to Israel but she would not say which unit or when it would arrive. “The THAAD deployment will have about 100 soldiers who will go over to Israel…. As you know, the Air Defense Artillery community is the most stressed, they have the highest [operational tempo] really, of any part of the Army.”

In October 2024, the US Army also expected to have its eighth THAAD battery fully operational by the summer of 2025.

With recent US Army/Missile Defense Agency (MDA) production, foreign sales underway, and continuing upgrades and support for BMDS now guaranteed following Russia’s firing on Dnipro and continuing North Korean threats, THAAD has finally become a huge program after all. Our forecast is for between $1.4 billion and $1.9 billion of funding annually for radar and C4I, continuing through our forecast period and beyond (totaling $16.7 billion in the next decade).

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