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Australia and the United States formalized a landmark defense industrial agreement Tuesday that will establish sovereign missile manufacturing on Australian soil by year’s end, significantly expanding the Pacific ally’s military capabilities while deepening strategic cooperation between the two nations.
Defence Industry Minister Pat Conroy announced the statement of intent between Australia’s Department of Defence and U.S. defense contractor Lockheed Martin during a pre-scheduled visit to Washington, timing that comes just days before Prime Minister Anthony Albanese’s meeting with President Donald Trump at the White House.
The agreement establishes a framework for Australia to begin manufacturing Guided Multiple Launch Rocket System (GMLRS) missiles domestically before 2026, with plans to construct a facility capable of producing up to 4,000 missiles annually — substantially exceeding Australia’s immediate defense requirements and positioning the country as a potential supplier to U.S. forces and allied partners.
“We will begin manufacturing missiles in Australia by the end of this year,” Conroy stated in an interview with Sky News. “So in answer to your question, very quickly. And that’s in a stage process where we will then begin production or construction rather of the Australian missile weapons complex.”
The GMLRS missiles, currently deployed in Ukraine’s defense against Russian forces, have a range of approximately 80 kilometers, effectively doubling the Australian Army’s current 40-kilometer strike capability. The production facility will be scaled to generate hundreds of missiles annually for Australian defense needs, with surplus capacity allocated to support United States stockpiles and partner nations facing global missile shortages.
Under the phased implementation plan, Australia will simultaneously construct a second manufacturing facility in partnership with Kongsberg Defence Australia near Williamtown, New South Wales. This installation will produce Naval Strike Missiles and Joint Strike Missiles, further diversifying Australia’s domestic defense industrial base.
“That will be located near Williamtown in New South Wales. And, again, that’s another example of where we’re producing a factory with scale more than we need at the moment to contribute to global supply chain,” Conroy explained. “So we’ll have two factories that will have scale more than we need so that we can support partners.”
The announcement represents a strategic shift toward co-design, co-development, co-production, and co-sustainment models between Australian and American defense sectors. Conroy characterized the agreement as Australia “adding value to the alliance” and investing in capabilities that serve both nations’ security interests.
Defense experts view the timing as strategically significant, given the Trump administration’s consistent pressure on allied nations to increase defense spending and industrial contribution. The White House has not yet commented on the agreement, though congressional leaders from both parties have previously expressed strong support for enhanced U.S.-Australia defense cooperation.
Beyond GMLRS production, the agreement creates pathways for Australia to eventually manufacture Precision Strike Missiles (PrSM) domestically. Australia conducted its first test firing of a PrSM missile earlier this year, two years ahead of schedule, with the first delivery arriving one year early. These advanced weapons systems feature ranges of 500 kilometers, with next-generation variants extending to 1,000 kilometers.
“So that’s a massive step up in long-range strike for the Australian Army compared to the 40 kilometres we’ve had previously,” Conroy said. “And the plan is that we would also have the option of producing PRISM missiles in Australia as well. We’re starting with Gimlas, which is a simpler missile but still very effective, and then we would move on to the precision strike missile later on.”
The defense industrial cooperation extends beyond missile production. Last year, a U.S. Navy Romeo helicopter underwent deep-level maintenance at Australia’s Navy helicopter facility in Nowra, receiving identical servicing to maintenance performed in the continental United States. This capability demonstrates Australia’s technical capacity to support American military operations while creating domestic employment opportunities.
“That’s another example of us mobilising the Australian industrial base to support the needs of the United States,” Conroy noted. “That adds jobs to us and it adds flexibility and depth to the United States.”
Former Australian Defence Minister Joel Fitzgibbon, who served in previous Labor governments, praised the agreement as beneficial for the alliance relationship. “This is a wonderful thing for our alliance relationship,” Fitzgibbon told Sky News. “I mean, we are investing both in their defence industrial base and our industrial base. That’s very, very important.”
Fitzgibbon suggested the timing, while officially described as coincidental, likely serves to strengthen Prime Minister Albanese’s position ahead of his White House meeting. “I’d be happy timing, but I think it’s a little bit more than a coincidence that Pat’s there ahead of the Prime Minister’s visit,” he said. “It just adds to what the Prime Minister will take to Washington.”
The agreement comes amid heightened strategic tensions in the Indo-Pacific region and global supply chain disruptions affecting defense manufacturing. Multiple nations are racing to expand missile production capabilities following Russia’s invasion of Ukraine, which has created unprecedented demand for precision-guided munitions.
Conroy acknowledged the global production backlog, stating there’s “a global backlog of production of missiles as people ramp up production response to the strategic circumstances.”
The Australian government has positioned the missile manufacturing initiative as serving dual objectives: enhancing national defense sovereignty while demonstrating alliance value to the United States. This approach directly addresses long-standing Trump administration critiques that allied nations have not sufficiently contributed to collective defense burdens.
“This is an example of us adding value to the alliance, us investing not just only in our needs but the needs of our indispensable ally, the United States,” Conroy said. “This is one example of us shifting to a co-design, co-development, co-production, co-sustainment model where we work in partnership with the United States and deepen the industrial base of both countries.”
The statement of intent formalizes cooperation frameworks but does not constitute a finalized production contract. Additional technical and financial negotiations will proceed in coming months to establish specific production timelines, cost-sharing arrangements, and technology transfer protocols.
Australian defence analysts have debated optimal investment strategies since the announcement of AUKUS nuclear-powered submarine agreements. Some commentators have advocated for prioritizing lower-cost, high-volume weapons systems modeled on Ukraine’s defense procurement approach, while government officials have emphasized the importance of long-term planning aligned with allied interoperability requirements.
“Since the birth of the orchestra arrangements, Defence expert pretenders have been coming out of the woodwork with all sorts of crazy ideas, wanting us to emulate Ukraine with the so-called cheap and the many,” Fitzgibbon said. “And the cheap and the many are OK if that becomes redundant in five minutes’ time and you end up with a warehouse full of them and they’re not much use to you.”
The Defence Strategic Review, conducted by the Albanese government, identified specific capability requirements that have guided investment priorities. Fitzgibbon expressed confidence that defense budget allocations will align with manufacturing timelines as production facilities become operational.
“You’ve got to have things to spend the money on. You can’t just spend tomorrow because you have an idea,” Fitzgibbon noted. “These things take time and the budget continues to grow right over the course of the next decade.”
Neither the Australian Department of Defence nor Lockheed Martin released statements detailing estimated production costs or facility construction timelines beyond Conroy’s year-end manufacturing commencement target.
The agreement signals Australia’s commitment to becoming a more substantial defense industrial partner within the broader U.S. alliance network, potentially serving as a regional manufacturing hub for precision munitions that could support operations across the Indo-Pacific theater.
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