General Dynamics Books $2.4B Navy Contract Option for One Block V Virginia-Class Submarine

General Dynamics’ (NYSE: GD) Electric Boat subsidiary has received a potential $2.42 billion contract modification from the U.S. Navy to build one Block V Virginia-class submarine equipped with Virginia Payload Module.

Electric Boat will continue to work with Huntington Ingalls Industries‘ (NYSE: HII) Newport News Shipbuilding division on the construction of the submarine, the Department of Defense said Friday.

The modification exercises an option for one additional vessel under the multiyear Block V contract awarded to General Dynamics Electric Boat in December 2019.

Contract work will occur in Virginia, Rhode Island, California, Connecticut, Maryland, Arizona, Pennsylvania and other areas within and outside the U.S. through February 2030.

Naval Sea Systems Command will obligate approximately $2.7B in shipbuilding and conversion funds for fiscal years 2018, 2019, 2020 and 2021 at the time of award.