Australia and the United States are joining forces to build and test hypersonic cruise missiles that can travel at five times the speed of sound and sink aircraft carriers.
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The missiles, designed to be fired from fighter jets, will be capable of flying the distance between Sydney and Melbourne in seven minutes.
Local defence companies will be approached to contribute to the project, which is expected to take between five and 10 years.
"Developing this game-changing capability with the United States from an early stage is providing opportunities for Australian industry," Defence Minister Linda Reynolds said on Tuesday.
"Investing in capabilities that deter actions against Australia also benefits our region, our allies and our security partners."
Australia has been working with the US on research into hypersonic scramjets, rocket motors, sensors, and advanced manufacturing materials for more than 15 years.
China and Russia have also been developing a range of new weapons including hypersonic and long-range ballistic missiles.
Australian Associated Press
