ST. LOUIS, Jan. 31, 2008 -- The Boeing Company [NYSE: BA] has been awarded a $73.7 million U.S. Navy contract to design and develop the Harpoon Block III missile, a next-generation weapon system that will enhance naval surface warfare capabilities.

The system design and development (SDD) contract will result in a kit upgrade program for existing Navy weapons that will return 800 enhanced surface- and air-launch Harpoon missiles and 50 ship-launch systems to the service's inventory.

"The start of SDD is a big milestone for the Harpoon program and is the first major development for the U.S. Navy on Harpoon for many years," said Jim Young, Jr., Boeing Harpoon Block III program manager. "Harpoon Block III will provide the warfighter with a capable, near-term solution to over-the-horizon, surface warfare threats."

Equipped with a new data-link system, Harpoon Block III will offer warfighters more control after the weapon is released, resulting in improved accuracy for littoral and open-ocean warfare. The Block III upgrade also positions the missile for future spiral developments, including extended range and vertical launch capabilities.

Harpoon Block III adds in-flight target updates, positive terminal control and connectivity with future network architectures to a proven missile that already provides autonomous, all-weather, over-the-horizon capability.