General Dynamics Lands $1.85 Billion Pentagon Deal To Bolster US Naval Strength

General Dynamics Corporation (NYSE:GD) announced on Wednesday that its subsidiary General Dynamics Electric Boat has secured a $1.85 billion contract adjustment from the U.S. Department of Defense to bolster submarine production efforts.

This contract modification, revealed in the Pentagon’s June 26 announcement, will fund long-lead materials and initial construction activities for Virginia-class submarines.

The funding will support the purchase of essential components requiring extended manufacturing timelines.

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These parts are critical for ensuring steady production output and helping the Navy maintain its underwater fleet capabilities.

The move reflects the Pentagon’s effort to signal a long-term commitment to submarine production and to support suppliers in scaling operations accordingly.

“This contract modification allows for the acquisition of critical material and components for Virginia-class submarines that require substantial lead time to manufacture and deliver. It sends a continued demand signal, supporting supplier investment in the capacity and materials needed to achieve our required production volume,” said Mark Rayha, president of General Dynamics Electric Boat.

He added, “Consistent funding and support such as this contract modification is essential for the shipyards to achieve the high-rate production of submarines the Navy needs.”

Electric Boat, based in Groton, Connecticut, employs over 24,000 workers and specializes in the design, construction, modernization, and maintenance of nuclear-powered submarines for the U.S. Navy.

According to Benzinga Pro, GD stock has gained over 3.17% in the past year. Investors can gain exposure to the stock via Pacer Funds Trust Pacer Solactive Whitney Future of Warfare ETF (BATS:FOWF).

Price Action: GD shares are trading lower by 0.02% to $292.36 premarket at last check Thursday.

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