The deal includes options to procure two additional vessels by 2023 and a source familiar with service documents said the multiyear agreement is expected to be valued at approximately $20B.
Capt. Danny Hernandez, a spokesman for the Navy, said in a statement that the service plans to announce by the end of December a contract, which he said aims to offer stability to the industrial base, include lethality improvements and generate savings.
“The contract being contemplated allows us to maintain a stable Virginia-class build rate,” said Elizabeth Power, a spokeswoman for General Dynamics’ Electric Boat subsidiary.
The company’s Electric Boat unit works with Huntington Ingalls Industries (NYSE: HII) to produce the Virginia-class submarine.