The US Navy’s top-of-the-line Interceptor missile has a high price, low purchases

• The US Navy’s SM-3 has been a key interceptor to defend Israel against Iranian attacks this year.
• The SM-3s are expensive, ranging from $10 million to $30 million per missile, and procurement plans are slim.
• The standard missile series could be crucial in a war against China.

One of the US Navy’s best ballistic missile interceptors, the Standard Missile-3, has been training in the Middle East this year, taking out Iranian missiles aimed at Israel.

However, these commitments did not come cheap. The SM-3 has a big price tag, nearly $30 million on the top end and nearly $10 million on the low end. This is a high cost per intercept, especially if more than one interceptor is fired per target.

In a world of fixed budgets, this cost raises questions about sustainability, both now and in a superior fight. Archer Macy, a retired Navy admiral and missile defense expert, told Business Insider that this is definitely “a problem” because “you have a limited amount of money that is appropriated by Congress. So either Congress has to provide more money, or the Navy has to stop buying other things.”

That high cost could mean less money for ships, training, or any number of other things the Navy needs. It could also limit the availability of interceptors if the Navy takes procurement funding instead.

Right now, there are concerns that the Navy is not buying close enough to these interceptors to prepare it for future threats, such as those from China’s formidable missile force.

US Navy warships first used SM-3 to protect Israel from Iran’s unprecedented attack in mid-April, which included a mix of more than 300 missiles and drones. It was then fired a second time during Iran’s massive barrage in early October, during which Tehran launched more than 180 ballistic missiles at Israel.

In both cases, the SM-3 “has shown its worth in spades,” Tom Karako, director of the Missile Defense Project at the Center for Strategic and International Studies, told BI.

The Navy said an unspecified number of interceptors had successfully engaged Iranian missiles.

After Iran’s attack in April, Navy Secretary Carlos Del Toro told lawmakers that the maritime service needs more SM-3s to counter potential future threats in the Indo-Pacific such as China.

“I truly believe that SM-3s will be needed in greater numbers in the future,” Del Toro said. “I think given the future threat and our Indo-Pacific deterrence mission, we will need more SM-3s in the future.”

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Why is the SM-3 so expensive?

The SM-3 is an interceptor made by RTX and, for the new Block IIA variant, Mitsubishi Heavy Industries, and is an element of the Navy’s highly advanced Aegis combat system.

The weapon uses a kinetic destruction vehicle to destroy short- and medium-range ballistic missiles in their time. the middle phase of the flight. The newest variant has demonstrated a destructive capability against intercontinental ballistic missiles.

Lt. Cmdr. Jason Tross, a spokesman for US Naval Forces Europe, told BI that the SM-3 “serves as the best deterrent in the world” against medium-range ballistic missiles.

There are several variants of the SM-3. The SM-3 IIA block costs just under $28 million, while the IB block is over $9 million.

One reason for the high costs is that to procure the specific microchips, sensor arrays and other technology for these missiles, the Navy must rely solely on contractors who previously built the materials to carry out the designs, many of which are older and involve certain technologies to order, said Bryan Clark, a former naval officer and senior fellow at the Hudson Institute.

The industrial process, along with the missile’s refined ability to intercept ballistic missiles, increases the cost of the interceptor.

RTX, the main manufacturer of the rocket, did not respond to requests for comment from Business Insider.

Analysts said the Navy needs these weapons, no matter the cost, if it is to be ready for high-end conflicts, adding that recent spending and plans for the arsenal are worrisome.

The proposed fiscal year 2025 defense budget reduced the procurement of SM-3 IBs over the next five years from 153 to zero, in an effort that saved just under $2 billion. Thus, only 12 SM-3 IIAs are produced annually for the next five years. Both analysts and Navy officials say that’s not enough.

Karako said buying more interceptors will lower the price per missile. “It’s like everything else: you buy the absolute minimum figures of the support rate, then it will be more expensive. You buy more and mass produce them, then the cost can go down.”

A potentially massive missile battle in the Pacific

In a war with China, the Navy could find itself up against China’s Missile Force, the crown jewel of its military, which has seen exponential growth in missile stocks, launchers and capabilities in recent years despite facing changes and corruption. scandals.

Against China’s anti-ship ballistic missiles and other threats, US warships would need a deep arsenal of SM-3s and other interceptors in the family of standard missiles such as SM-2 and SM-6 – both The Navy spent during its ongoing campaign against the Houthis.

The Navy wants increased production of the SM-6, and the newest variant is designed for more effective defense against cruise, ballistic and potentially hypersonic missiles. These interceptors cost around $4 million per unit.

“The SM-3 is not the only answer,” said Macy, a nonresident senior associate with the Center for Strategic and International Studies’ Missile Defense Project. The Navy must balance its priorities, but both analysts and service leadership recognize the need for a larger stockpile of these next-generation interceptors.

“To do those heavier tasks, it just costs money,” Macy said, explaining that the Navy has to pay the high costs if it’s going to be ready for the kind of warfare these missiles were made for.

For now, the most likely adversary for the SM-3 is Iran’s ballistic missiles, given the ongoing conflict in the Middle East and high tensions between Tehran and Israel. However, the US is keeping a close eye on China’s growing arsenal as the threat of a Pacific struggle looms.

“The SM-3 missile remains ‘mission ready’ to deter Iran or any other state actor seeking to use ballistic missiles as part of a campaign of terror,” said Tross, the Navy spokesman.