Kratos Defense & Security has cleared the final development milestone for its BQM-177A Subsonic Aerial Target.

The achievement allows the project to enter low-rate initial production, which is set to begin once the Federal Fiscal 2017 budget receives Congressional approval.

The BQM-177A is marketed as the U.S. Navy's next-generation Sub-Sonic Aerial Target, or SSAT. It is designed to provide threat emulation for air-to-air engagements. According to Kratos, the product is capable of reaching speeds in excess of 0.95 Mach, and has a sea-skimming altitude as low as 10 feet.

"The entire USD team is proud to have recently achieved the final development milestone on the United States Navy SSAT Program that was required prior to the commencement of production, which we currently expect to begin early next year," Kratos Unmanned Systems Division president Jerry Beaman said in a press release.

The BQM-177A is a follow-up to the existing BQM-74E. Kratos officials say the new model offers greater maneuverability than its predecessor by offering a new fuselage, high-mounted wings, and an internally integrated MicroTurbo TR-60-5+ jet engine.

The U.S. Navy has plans to replace the BQM-74E with the new product once production is complete.

"The United States Navy is one of our company's most important customers, and the Kratos and USN teams have in unison achieved this critically important milestone," Kratos CEO Eric DeMarco said.

"We expect to enter into production on the SSAT Program in 2017, along with another Kratos unmanned aerial target drone program that we have under contract. These two programs are the primary drivers in our expectation to double the size of our unmanned systems business over the next two years."