The U.S. Air Force has released details of a $145 million contract action to develop and integrate an Air-to-Air Dual Mode weapon based on the Advanced Precision Kill Weapon System (APKWS), aimed at countering large groups of unmanned aerial systems.
According to a Justification and Approval document published February 13, 2026, the effort supports a Joint Urgent Operational Need (JUON) issued by combatant commanders in August 2024. The requirement was driven by what officials described as growing risks from mass attacks involving lower-cost Group 3 drones, potentially numbering in the hundreds, particularly in the U.S. Central Command area of responsibility.
The program focuses on upgrading the AGR-20F APKWS rocket, also known as FALCO, with new components to create prototype air-to-air rounds. The upgraded configuration includes a nose-mounted Long Wave Infrared seeker, a mid-body warhead, and a dual safe proximity fuze designed to defeat Group 3 UAS threats.
According to the document, the new configuration enables a handoff from laser designation to infrared homing, reducing the time aircraft operators must maintain laser contact with a target. The Air Force stated that the modification minimizes exposure during engagements while allowing faster targeting cycles against multiple airborne threats. The upgraded components are designed to remain compatible with the existing APKWS interface developed by BAE Systems.
Contract specifics
The contract action is structured as an Indefinite Delivery/Indefinite Quantity (IDIQ) agreement and is expected to be awarded on a sole-source basis to BAE Systems in Hudson, New Hampshire. Work must begin no later than the second quarter of fiscal year 2026 to meet operational timelines set by U.S. Central Command and Air Force Central Command.
Under the program plan, government personnel will assemble 300 prototype All-Up Rounds using components delivered through the contract. Of those, 100 rounds will support integration and qualification testing, while 200 will serve as operational test assets deployed for evaluation in operational environments. The prototypes are intended to provide an initial capability within 24 months of the original August 2024 JUON.
Integration testing is planned on the F-16 platform to validate airworthiness and operational performance requirements. The missiles are also intended for integration on the U.S. Navy’s MH-60 fleet.
Air Force acquisition officials concluded that BAE Systems was the only responsible source capable of meeting the required delivery schedule. Market research conducted through a March 2025 Request for Information received 43 industry responses. However, officials determined that alternative proposals could not meet airworthiness standards, aircraft integration requirements or the mandated 24-month delivery timeline. Awarding the effort to another vendor was assessed as potentially delaying the capability by more than 44 months.
Funding allocations include approximately $62 million for component development, $56 million for testing and qualification of operational units and $27 million for technical risk reduction and U.S. Navy certification activities. The program also seeks expanded government technical data rights to support future integration of alternative components and potential competitive procurement.
The Dual Mode initiative builds on operational experience from the FALCO program and previous APKWS adaptations used in counter-UAS roles, including defense of commercial shipping in the Red Sea and Bab Al-Mandab Strait in 2023 and 2024.
Program documentation outlines a 24-month development and integration phase followed by a 60-month ordering window intended to transition the capability toward production-ready status. The effort reflects broader Pentagon priorities to address the cost imbalance between high-end air-to-air missiles and lower-cost unmanned threats, while providing magazine depth against large-scale drone swarms.
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Post Image Credit: BAE Systems
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