Boeing has once again reinstated its position as the prime contractor for U.S. defense deasl after defeating Bethesda, Md.-based Lockheed Martin in a $3.5 billion worth contract.

The Pentagon announced the seven-year contract has been awarded to Boeing to develop, test and manufacture missile defense systems.

One of the world's largest defense contractors, Lockheed Martin was also vying for the deal in order to develop and expand the country's Groundbased Midcourse Defence (GMD) systems for intercepting incoming warheads in space.

At present, GMD is a major component of the U.S. national missile defense strategy aimed against ballistic missiles, including intercontinental ballistic missiles (ICBMs). The system provides early detection and tracking during the boost phase, midcourse target discrimination, precision intercept and destruction of inbound ICBMs through force of hit-to-kill technology.

There are currently more than 20 interceptors fielded and the program continues to field additional interceptors and to integrate additional sensors into the GMD system. GMD system elements reach across 12 time zones and are linked by over 20,000 miles of fibre optic cable.

Boeing, based in Seattle, had been the prime contractor for designing, producing, integrating, testing and sustaining all GMD components since 1998.

The system has achieved a total of eight successful intercept tests, including three successful intercept tests with the operationally configured interceptor. Boeing said the program has totalled around $18 billion during the 10 years ending 2011.