On Tuesday, in what appears to be a surprise announcement, the Department of Defense confirmed that it has awarded Northrop Grumman (NYSE:NOC) a $37.3 million "modification" to an existing logistics and engineering support contract for the Hunter Unmanned Aircraft System (UAS, or more commonly, UAV for "unmanned aerial vehicle").
The Hunter UAS currently in use by the U.S. was originally based on a UAV developed by Israel Aircraft Industries. According to Northrop, the RQ-5A Hunter was the first unmanned aerial vehicle deployed by the U.S. Army, in 1996. It has since been upgraded to the MQ-5B configuration and weaponized by being equipped with laser-guided bombs, which were also developed by Northrop.
Hunter also appears to be extraordinarily long-lived. The UAV was scheduled to be replaced by Textron's (NYSE:TXT) RQ-7 Shadow UAV some years ago but has maintained a place in the Army's arsenal alongside the Shadow regardless. As of October, the Army is said to have 20 MQ-5B Hunters still in service.
Experts have also suggested that Hunter will finally be phased out this year, to be replaced by General Atomics' MQ-1C Grey Eagle UAV. However, Tuesday's contract award, which posits an estimated completion date of Jan. 14, 2014, suggests that the Hunter will survive the year and still be flying missions into 2014.
Fool contributor Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of Northrop Grumman and Textron. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.