How much does the PAC-3 ACE cost compared to the current version?

The PAC-3 ACE costs less than $2 million per unit, compared to $4 million for the MSE version.

Why is the PAC-3 ACE important?

It aims to counter the growing threat of low-cost drones with a low interception cost, enhancing air defense capabilities.

Lockheed Martin Unveils Cheaper Interceptor to Counter Cheap Drones

Lockheed Martin has developed the PAC-3 ACE interceptor, priced at less than half the $4 million per-unit cost of the current MSE version, to counter the rising threat of inexpensive drones.

July 20, 2026

2 min read

Source: GuruFocus.com

Key Numbers

current MSE cost

$4 million

new ACE cost

less than $2 million

Lockheed Martin (NYSE: LMT) has announced the development of the PAC-3 ACE interceptor, which will cost less than half the current $4 million per-round MSE version. The new system is designed to address the growing threat of low-cost drones.

The Product

The PAC-3 ACE is an upgraded version of the PAC-3 missile, optimized to intercept drones and cruise missiles at a lower cost. It features enhanced multi-target engagement capabilities while maintaining high accuracy. The primary goal is to reduce interception costs to match the low cost of drones.

Pricing and Availability

Lockheed Martin has not disclosed the exact price but confirmed it will be under $2 million per unit, compared to $4 million for the MSE variant. Production is expected to begin by 2028.

Competition

Lockheed faces competition from Raytheon (RTX), which is developing similar interceptors like the Coyote, as well as non-traditional solutions such as directed energy weapons (lasers).

Potential Impact

PAC-3 ACE is expected to strengthen Lockheed Martin's position in the air defense market, especially as demand grows for cost-effective solutions against inexpensive aerial threats. This could lead to increased contracts from the U.S. Department of Defense and allied nations.

Frequently Asked Questions

The PAC-3 ACE is an upgraded version of the PAC-3 missile, designed to intercept drones and cruise missiles at a lower cost.

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This article was rewritten in Wrqti's editorial style based on information from the original source above. Content is informational only — not investment advice.