Australia announces $2.4 billion spending for air and missile defence

The Australian Government is investing $2.4 billion to strengthen Australia’s air and missile defence capabilities while building a resilient sovereign defence industrial base. Delivered as part of the second tranche of AIR 6500, this investment is a critical component of the Albanese Government’s commitment in the Integrated Investment Program of $30 billion over the coming decade to deliver a layered, integrated air and missile defence system.

This investment will be made over six years, through Defence’s existing strategic partnership with Lockheed Martin Australia providing more than 360 highly skilled jobs, in both the Hunter Region and South Australia, and support Australian Defence industry.

The foundation of this project is the Joint Air Battle Management System, a system which connects information and capabilities from across the Australian Defence Force into a single, effective network, providing a better view of the battlespace and helping commanders make faster, better informed decisions.

This $2.4 billion investment will replace the existing system and modernise air surveillance, and aircraft control functions while supporting the coordination of Defence operations in Australia and overseas. The capability will connect current and future Defence platforms, including Hobart-class destroyers, the F-35A Lightning II aircraft and the accelerated Medium-Range Ground-Based Air Defence system. This will strengthen Australia’s ability to operate as an integrated force and detect, track and respond to increasingly sophisticated air and missile threats.

With the capability designed and built in Australia, the Albanese government is once again prioritising Australia’s sovereign defence industrial base and supporting well-paid, secure and highly skilled local jobs.

Deputy Prime Minister, the Hon Richard Marles said:  “Today’s announcement is seeing the Albanese Government once again supporting well-paid, secure Australian jobs and backing Australian Defence industry. AIR 6500 is a landmark investment in Australia’s air and missile defence and will help ensure the Australian Defence Force can respond effectively to future threats and deliver on the priorities of both the National Defence Strategy and the Defence Industry Development Strategy. The project will upgrade the command and control systems needed to strengthen the Australian Defence Force’s ability to detect, track and respond to threats in an increasing complex strategic environment.

Minister for Defence Industry Pat Conroy said: “The Defence Industry Development Strategy recognises that Australia’s security depends not only on the capabilities we acquire, but also on our ability to design, sustain and evolve them here in Australia. Through AIR 6500, we are delivering a world-class command and control capability while strengthening Australia’s sovereign industrial base, growing a highly skilled workforce and retaining critical integrated air and missile defence expertise in Australia. The Australian Government’s investment directly supports more than 360 highly skilled jobs Australian jobs helping build the workforce, expertise and industrial capability Australia needs into the future.”

Lockheed wins $1.32 billion for joint air battle management system

The Australian Government has awarded Lockheed Martin Australia a $1.32 billion contract to advance and sustain AIR6500—a sovereign, high-tech joint air battle management system that integrates Australia’s air and missile defence capabilities across all-domains into a single, unified view of the battlespace to detect and counter threats at various ranges. Under Tranche 2B, Lockheed Martin Australia, together with the Department of Defence and Australian industry, will enhance AIR6500’s core architecture with advanced C2 aids, expanded comms, and cyber‑security to maintain resilient, networked sensor and C2 capabilities that can sense and track incoming threats and integrate with the Australian Defence Force’s targeting enterprise, allies and partners. This framework establishes a scalable path for ongoing systems innovation and rapid integration of future technologies, keeping Australia ahead of emerging threats.

Lockheed Martin Australia will continue to sustain, train, and grow its 360 locally skilled engineering workforce, the largest integrated air and missile defence industrial base in Australia, while expanding the team to 400+ within 18 months. Over the next six years, a substantial share of the AIR6500 Tranche 2B effort will be delivered by Australian Industry partners. Independent of the program, Lockheed Martin Australia is investing $85.9 million in a national integrated air and missile defence facility to ensure end‑to‑end system resilience.

Lockheed Martin’s president of Rotary and Mission Systems, Stephanie C. Hill, said, “As the strategic partner for AIR6500, Lockheed Martin is proud to continue working with the Department of Defence to rapidly evolve an advanced integrated air and missile defence system that safeguards the Indo‑Pacific region. Together, we are maturing a significant capability that strengthens Australia’s national security and increases allied interoperability to combat future threats.”

Over the past two years, Lockheed Martin Australia has delivered a series of milestones in Tranche 2A AIR6500, laying the groundwork for the next phase of AIR6500:

• produced a modular joint air battle management system prototype, two joint tactical operations centres and a single persistent operations node, for testing and evaluation
• provided training to the Royal Australian Air Force on delivered elements
• completed fit‑out of the AIR6500 integration lab in Adelaide
• developed a 360-strong engineering and technical workforce while partnering with Australian Industry to maximise sovereign content in the system.

Lockheed Martin Australia and New Zealand’s Chief Executive, Jeremy King, said, “This contract confirms the Australian Government’s confidence in Australian Defence Industry’s capacity to deliver world‑class, Australian‑built capabilities that are trusted to protect our nation and its allies. Lockheed Martin Australia remains firmly committed to continue partnering with primes, small-to-medium enterprises, and academia to source the best‑of‑breed technologies, delivering a sovereign solution that strengthens Australia’s industrial self-reliance and prosperity. The next phase of AIR6500 fortifies the core of Australia’s integrated air and missile defence. AIR6500 enhances the joint force by bringing all ADF defence assets together on a scalable, resilient, and collaborative platform. It gives us clearer cross‑domain awareness and a more effective way to respond to air and missile threats.”

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