Oops!

Did I say Oceaneering International (OII -1.23%), iRobot, and Boeing were the leading contenders to build DARPA's new underwater aircraft carrier? Turns out I may have left one possibility out: General Dynamics (GD -5.52%), maker of the "Knifefish" Surface Mine Countermeasure Unmanned Undersea Vehicle, or UUV.


 Scale model of the planned Knifefish.

Envisioned as a complement to the Littoral Combat Ships that General Dynamics and Lockheed Martin (LMT -0.32%) are building for the Navy, the Knifefish is designed to detect mines in high-clutter underwater environments. The 1,700-pound robot is equipped with a low-frequency broadband synthetic aperture sonar system, and a two-way communications system that the mothership can use to tell it where to go. General Dynamics and its partners, which include Oceaneering International, will also equip Knifefish with ultra-high-density data storage/recording equipment, so that data acquired on a scouting expedition can be examined in detail upon return to base.

Loaded aboard a Littoral Combat Ship, the Knifefish will become part of the planned "Mine Warfare" mission package. Ultimately, the Navy intends to purchase 48 Knifefish UUVs to load aboard its LCS fleet. This will be enough to outfit two dozen LCSes, and turn nearly half the LCS fleet into robotic minesweepers if necessary. The first deployment is planned to take place in 2017.


General Dynamics' Independence-class Littoral Combat Ship, Source: Wikimedia Commons.

Where we're at today
Knifefish -- and General Dynamics -- took a big step toward that goal this past week, when the company announced that its UUV has successfully completed the Navy's "comprehensive risk reduction program." This was a key step preparatory to beginning production. 

As General Dynamics explained in a statement on the accomplishment, data from the risk-reduction program will be used to "identify critical elements that could be detrimental to the delivery and operational availability of the Knifefish program," and fix them before they become a problem. (With a $170 million, five-year contract on the line, you can't be too careful about these things.)

Where we're headed
Going forward, it's hard to say how much the Knifefish program might be worth to General Dynamics. Extrapolating from the $170 million contract for a first batch of eight "fish," though, suggests that a full complement of 48 UUVs could generate nearly $1 billion in revenues for the company.

And the program could get bigger than that. A report in the Australian Defence Magazine earlier this year suggests that nation may be interested in spending up to $100 million on Littoral Combat Ships equipped with a Mine Warfare mission package -- and that's just one of several U.S. maritime allies who might turn out to be interested in Knifefish.

In short, even for a big defense firm like General Dynamics, with $31 billion in annual revenues, this little "fish" could be a really big deal.

Boeing operates as a major player in a multitrillion-dollar defense market in which the opportunities and responsibilities are absolutely massive. However, emerging competitors and the company's execution problems have investors wondering whether Boeing will live up to its shareholder responsibilities. The Fool's premium research report on the company provides investors with the must-know issues surrounding Boeing. They'll be updating the report as key news hits, so don't miss out -- simply click here now to claim your copy today.