By Victor Abramowicz*The United States is moving to integrate its land-based PAC-3 surface-to-air missile on to warships. This effort presents an opportunity to enhance key Australian Defence Force capabilities and support sovereign R&D and industry—but quick work is needed. (From The Strategist. The Australian Strategic Policy Institute.)
BMD is particularly important and difficult since ballistic and hypersonic weapons are fast, manoeuvrable or both. They’re hard to intercept. Further, they are proliferating around the world. Once the province of great powers, now even factions like the Houthis have ballistic missiles, even some that can home on ships. China has one of the largest ballistic and hypersonic missile forces.
The ADF has no BMD capability. One will arrive only with delivery of long-range (250 km plus) SM-6 missiles that Canberra ordered in undisclosed numbers in 2024. The $7 billion arms package also included SM-2 missiles for use against aircraft and cruise missiles. The navy’s Hobart and Hunter class vessels will carry these weapons in Mark 41 launchers and control them with Aegis command systems. This is essentially the same standard setup as the US Navy’s.
Yet the combination of SM-2s and SM-6s has important limitations for AMD and especially BMD. Firstly, the missiles are derived from a 1960s design and so lack key modern technologies, such as lateral rocket thrusters that quickly throw a missile on to a new course, for defeating highly manoeuvrable targets.
The SM-2 has no BMD capability, and the SM-6 is unproven against complex threats, having had limited operational use, mainly against simpler Houthi weapons. (It worked.) Also, the supply of the SM-6 is constrained, with annual production now around 125 rounds and planned to rise to 300 by 2028. The then-US Navy secretary, Carlos Del Toro, said in April 2024 the service had fired off more than US$1 billion of missiles in only a few months, so we may wonder when Australia will receive its SM-2s and SM-6s.
A promising solution is to stick with buying the SM-6 for long-range defence but use the PAC-3, a US Army weapon used in the Patriot system, instead of the SM-2. The US Navy is thinking of doing the same. The PAC-3 entered service in the 1990s in a configuration called CRI that included modern technology (such as lateral thrusters) for advanced BMD and AMD tasks. The version that would replace the SM-2 would be the more recent PAC-3 MSE, which would offer comparable range (120 km plus) and occupy the same space in a Mark 41 tube.
The PAC-3 has demonstrated extensive BMD success, with PAC-3 MSEs intercepting the most modern Russian weapons in Ukraine, including hypersonic weapons that the Kremlin calls unstoppable. In response to demand from Ukraine and the spread of such threats elsewhere, the US has expanded today’s PAC-3 MSE production to 600 rounds per annum, rising to 650 in 2027.
The potential to replace the SM-2 led Lockheed Martin, the PAC-3 manufacturer, to work in earnest from 2023 to integrate the PAC-3 MSE with naval systems. It wanted to gain the US Navy’s attention. This work proceeded quickly, with 2024 seeing an MSE’s first flight from a launcher derived from the Mark 41 and integrated with a virtual Aegis system. This was successful enough for Washington to include USD75m of funding for continuing the work in 2025.
All this presents a two-phase opportunity for Australia. Firstly, there’s the chance to contribute to PAC-3 MSE integration effort. This aligns with the Guided Weapons and Explosive Ordnance (GWEO) Plan, which includes a focus on expanding Australian missile research, development and production capability. Yet with Lockheed’s naval PAC-3 work proceeding quickly, Canberra would need to move fast.
Another option might be to fund PAC-3 CRI missile integration, noting that design is still in service, is BMD capable and small enough to fit four into one Mark 41 tube (which would hold only one PAC-3 MSE or one SM-2). Alternatively, ensuring PAC-3 works well with the Hunters’ CEA radars would benefit the missile’s and radar’s export prospects.
In the second phase, Canberra should cancel the freshly ordered SM-2 and buy PAC-3 MSE instead if Lockheed Martin successfully integrates it with naval systems. Further, Australia should seek to start PAC-3 production under GWEO to meet our needs and those of other nations, noting that 12 use the SM-2 and nearly 20 use the Patriot.
A final matter is cost: who will pay for all this? Well, for phase one the US is covering most of the work, and even matching Washington’s investment (around $118m) is spare change in Australia’s $59bn defence budget. For phase two, there’d be money available from the SM-2 portion of the 2024 arms deal (minus any contractual penalties), plus options such as realigning funds from behemoths like the AUKUS submarine program.
Pursuing the PAC promises to affordably provide a much more capable ADF, and more developed Australian GWEO capability, in short order.
