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Raytheon to build advanced radar systems for US Navy in $1.6 billion deal

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The US Navy has chosen Raytheon Co. over Lockheed Martin Corp and Northrop Grumman Corp to build its new defense radar for use on Arleigh Burke destroyers in a contract valued at $1.6 billion.

For use with the Aegis combat system, the next-gen air and missile defense systems will be integrated with the existing AN/SPQ-9B X-band radar when officially put to use in 2016. Designs are set to outfit at least 22 naval ships; half being built at General Dynamics Corp.'s Bath Iron Works in Maine.

According to reports, the radar will be designed to detect long-range missiles. 

Though the initial design contract was worth $386 million, the optional deal to procure up to nine radars brings the value up. 

"We are confident in our AMDR solution, leveraging our decades of radar development and integration experience," Raytheon spokesman Dave Desilets said. "We are eager to move forward and deliver this exceptional capability to the Navy."

Interestingly enough, Raytheon also beat its rivals to develop a next-generation electronic jammer in July with opposition coming from BAE Systems Pic who filed a protest with the US Government Accountability Office. Lockheed did issue a statement late Thursday, expressing disappointment.

"We will await the Navy's de-brief in order to understand why we were not selected and evaluate our next steps," Lockheed spokesman Keith Little said. 

Defense analyst with the Lexington Institute in Washington Loren Thompson said the deal is surprising considering spending cuts. 

"Raytheon has once again secured business in a new area at a time when rivals are seeing their revenues decline," Thompson said. " It's nearly impossible to grow market share in a defense downturn and Raytheon is managing to do it."

Raytheon will build the systems at its facilities in Andover and Sudbury where as one of Massachusetts' biggest employers with a workforce of 68,000 worldwide. Last year, the defense contractor generated a recorded $24 billion in sales.

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