BAE Systems and the U.S. Department of War have signed a framework agreement covering the procurement of up to 25,000 APKWS laser-guidance kits annually for as many as seven years. The arrangement supports increased production in Hudson, New Hampshire, and Austin, Texas, with a potential expansion to 35,000 kits per year for additional U.S. and allied demand.
The framework is not a finalized multiyear procurement contract. BAE Systems and the department must still negotiate that contract, while purchases remain subject to congressional authorization and appropriations. The agreement gives the company a longer-term demand signal for long-lead components, production expansion and workforce growth.
APKWS kits convert unguided 2.75-inch rockets into laser-guided precision munitions. The system is fielded by the U.S. Air Force, Army, Marine Corps and Navy, and is available to allied customers. Its comparatively low cost has increased its relevance for counter-unmanned-aircraft operations and other missions.
The 35,000-kit figure represents potential annual capacity rather than a guaranteed purchase. Expansion beyond 25,000 kits would depend partly on allied demand submitted through the Foreign Military Sales process. Neither BAE Systems nor the department disclosed the agreement’s value. The arrangement follows BAE Systems’ delivery of its 100,000th APKWS kit earlier in 2026.