On Friday, the Department of Defense awarded a pair of contracts benefiting General Dynamics (GD +0.36%). Together, the contracts are worth roughly $43.2 million, breaking down as follows.
The larger contract goes to the company's General Dynamics Information Technology division, and it's a $23.2 million cost-plus-fixed-fee incrementally funded contract to continue supporting U.S. Air Force simulation, training, and experimentation programs. This contract runs through March 26, 2015.
The smaller but more interesting contract pays General Dynamics partner Austal USA $20 million to "assess engineering and production challenges and evaluate the cost and schedule risks from affordability efforts to reduce LCS acquisition and lifecycle costs." This contract mirrors a similar, but larger, award simultaneously issued to fellow Littoral Combat Ship-builder Lockheed Martin (LMT 2.62%). The Navy is hiring both companies to provide guidance on any potential downsides to efforts to cut costs on the LCS program, which is currently overbudget. This contract has a March 2014 complete date.
