Lockheed Martin and Arabian International Company for Steel Structures (AIC Steel) have announced a significant expansion of THAAD Weapon System component manufacturing in the Kingdom of Saudi Arabia. The two defense industry leaders signed a memorandum of understanding on February 12, 2026, in Riyadh to increase localized production of missile round pallet-transportable (MRP-T) units, a critical component of the Terminal High Altitude Area Defense system.
Strategic Partnership Deepens Defense Localization
The new agreement builds upon an existing localization contract between Lockheed Martin and AIC Steel, officially recognizing AIC Steel as a qualified Lockheed Martin supplier. This partnership was first announced at the 2024 World Defense Show, and in 2025, the companies celebrated a major second-source production milestone. The expanded collaboration directly supports Saudi Vision 2030’s objectives for industrial diversification and defense self-sufficiency.
“The global demand for proven air and missile defense systems highlights the need to secure a robust and global supply chain base. This MOU paves the way for increased THAAD hardware production in Saudi Arabia and deepens Lockheed Martin’s role in helping secure a trusted U.S. ally against ballistic-missile threats.”
Jason Reynolds, Vice President of Integrated Air and Missile Defense at Lockheed Martin
THAAD Weapon System Localization Advances
The Kingdom of Saudi Arabia identified localization as a key objective when it signed an agreement with the U.S. government to procure the THAAD Weapon System in 2017. In 2022, Lockheed Martin and GAMI announced their intent to collaborate on localizing work for the system in Saudi Arabia. This latest MOU represents a significant step forward in that commitment, bringing advanced defense manufacturing capabilities to the region while supporting technology transfer and high-skill job creation.
The combat-proven THAAD Weapon System provides regional deterrence and demonstrated capability against various ballistic-missile threats. By expanding local production of MRP-T units, Saudi Arabia strengthens its strategic defense infrastructure while developing indigenous technical expertise in advanced weapons systems.
Economic and Strategic Benefits
“Partnering with Lockheed Martin to scale up production of the MRP-T units reinforces AIC Steel’s commitment to delivering world-class, locally manufactured defense solutions. This collaboration not only enhances Saudi Arabia’s strategic defense self-sufficiency, but also drives technology transfer, creates high-skill jobs and aligns directly with Vision 2030’s industrial diversification goals.”
Wasim Attieh, President of AIC Steel
The partnership delivers multiple benefits beyond defense capabilities. It cultivates local talent through advanced technical knowledge transfer, creates employment opportunities in high-technology manufacturing, and strengthens the broader defense industrial base in both Saudi Arabia and the United States. The initiative demonstrates how international defense cooperation can support economic development objectives while enhancing national security.
Future Outlook for Defense Manufacturing
As global demand for advanced air and missile defense systems continues to grow, the expanded manufacturing capacity in Saudi Arabia positions the Kingdom as a key player in the regional defense supply chain. The collaboration between Lockheed Martin and AIC Steel serves as a model for defense localization programs that balance strategic security requirements with economic development goals. This partnership is expected to pave the way for additional defense manufacturing initiatives in the Kingdom, further advancing Saudi Vision 2030’s objectives for a diversified, knowledge-based economy.
