General Dynamics Electric Boat Gets $1.3B Navy Contract Modification for Submarine Materials

A General Dynamics (NYSE: GD) subsidiary has secured a potential $1.3 billion contract modification from the U.S. Navy to provide long lead time materials to support the construction of Virginia-class Block VI submarines.

The Department of Defense said Monday General Dynamics Electric Boat will perform work in California, New Jersey, Illinois, Colorado, Maryland, Pennsylvania, Virginia, Connecticut, Wisconsin, Michigan, Massachusetts, Texas, Ohio and other locations through September 2035.

“This contract modification sends a crucial demand signal, enabling our suppliers to invest in the capacity and materials needed to increase production volume,” noted Kevin Graney, president of General Dynamics Electric Boat.

“Consistent funding for the supply base is essential to achieve the high-rate production the Navy requires of the entire submarine enterprise,” added Graney.

Naval Sea Systems Command will obligate the full contract amount using fiscal 2024 shipbuilding and conversion funds.

In July, Electric Boat received a $181 million contract modification to supply materials for the submarines.

Virginia-class submarines are designed to support special operations, anti-submarine and surface ship warfare missions.

Electric Boat serves as the prime contractor on the Virginia-class submarine program and builds the underwater vehicle through a partnership agreement with HII’s (NYSEL HII) Newport News Shipbuilding business.

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