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General Dynamics Wins $118 Million Stryker Upgrade Contract

Nearly eight months after plans to "sequester" the defense budget put 139 jobs at risk at General Dynamics (NYSE: GD  ) Land Systems' Stryker plan in Anniston, Ala., General D appears to have won a reprieve.

On Tuesday, General Dynamics announced that it has won a $118 million contract from the U.S. Army's TACOM Life Cycle Management Command to convert 66 flat-bottomed Stryker infantry combat vehicles to a newer "double-V hull" design, better able to withstand blasts from landmines and roadside bombs. General Dynamics noted that it expects to begin delivering the upgraded vehicles to TACOM in July 2014 and will continue working on the project through February 2015.

That works out to a conversion rate of about eight units per month -- roughly the halving of GDLS's previous 20-units-per-month rate as the company had warned back in January, but preventing the need to wind down conversions entirely, as GDLS had feared might become necessary. This week's contract should suffice to keep about 80 employees at work, who might otherwise have been laid off.

GDLS built two brigades' worth of Strykers from July 2010 to July 2013, about 700 vehicles. The company completed upgrades on a fleet of 52 formerly flat-bottomed Strykers in April 2013, "on time and under budget."

The Stryker is a lightly armed and armored, eight-wheeled armored vehicle capable of traveling at speeds of up to 62 mph. It was designed to operate in more urban, better-paved environments than the Army's Bradley Infantry Fighting Vehicle, and was first widely used during the invasion of Iraq in 2003.

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DocumentId: 2633432, ~/Articles/ArticleHandler.aspx, 9/29/2016 1:28:24 PM

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9/29/2016 1:13 PM
GD $155.39 Down -0.62 -0.40%
General Dynamics CAPS Rating: ****