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General Dynamics and Austal Win 3 Defense Contracts Friday

By Rich Smith – Mar 1, 2014 at 6:45AM

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General Dynamics will perform submarine work for the U.S. and British navies. Partner Austal will perform deferred work on LCS 6.

The Department of Defense awarded 30 separate defense contracts Friday, worth a total of $1.99 billion. Roughly 10% of these went either to General Dynamics (GD 0.73%), or to its partner in the U.S. Navy's Littoral Combat Ship program, Australian shipbuilder Austal (AUTLY).

General Dynamics itself won two contracts:

  • $19.9 million as a contract modification instructing it to provide additional engineering and technical design services to the U.S. Navy in support of advanced submarine technology research and development (R&D) on current and future submarine platforms. This R&D work will include studies to support the "manufacturability, maintainability, producibility, reliability, manning, survivability, hull integrity, performance, structural, weight/margin, stability, arrangements, machinery systems, acoustics, hydrodynamics, ship control, logistics, human factors, materials, weapons handling and stowage, submarine safety, and affordability" characteristics of U.S. submarines. General Dynamics will also do work on near-term insertion of technology into Virginia-class boats, identification of technology options for upgrading Ohio-class submarines, future submarine concepts, and core technologies. This work will continue through October 2014.
  • $16 million as a separate contract modification funding the acquisition of long-lead-time missile tube materials needed for the Ohio Class Replacement Program. The company will be designing and manufacturing hardware to be used in the Common Missile Compartment -- comprising the missile tubes and related systems that will be used to launch the next generation of missiles (succeeding the Trident II/D5) from submarines in the U.S. and British fleets. This work is scheduled to be completed by February 2016.

Separately, General Dynamics partner Austal won a $7.1 million option exercise for post-delivery support for the littoral combat ship USS Jackson (LCS 6). Austal will plan and implement deferred design changes that were identified during the ship's construction. This work should be completed by September 2015.

Rich Smith has no position in any stocks mentioned. The Motley Fool owns shares of General Dynamics. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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