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General Dynamics Awarded $600 Million in New Contracts

FALLS CHURCH, Va. -- General Dynamics (NYSE: GD) was awarded four U.S. Government contracts on Thursday, October 26, with a cumulative combined value of more than $600 million.

The contracts include a $477 million award for delivery, maintenance and support of five modified Gulfstream V aircraft to the Department of Defense’s regional Commander in Chief support program; a $54 million award for submarine fire-control systems and related services; and a $13.7 million award for submarine engineering and life-cycle support services. In addition, the NASSCO shipyard in San Diego was selected as the planning yard for continuous maintenance and support of destroyers and cruisers through 2004, a contract with a potential value of more than $68 million.

The contracts were awarded to General Dynamics’ Gulfstream Aerospace, Defense Systems, Electric Boat and NASSCO subsidiaries, respectively.

Gulfstreams to the Military

Under the contract announced yesterday, Gulfstream Aerospace (Savannah, Ga.) will provide five Gulfstream C-37A aircraft to the U.S. Air Force in a $477 million lease and support service agreement. The Multi-Year Aircraft Lease Pilot Program will supply additional aircraft for the Department of Defense regional Commander-in-Chief (CINC) mission, and maintenance support services, for up to 10 years.

The first two special mission C-37A’s, a U.S. military designation for the Gulfstream V, will be delivered to the Air Force in July and August 2001. The remaining three aircraft will be delivered by September 2003. The new contract will quickly place C-37A’s into the government fleet to replace aging, airline-type aircraft that average more than 40 years of age. The cost-avoidance and savings to the Air Force over the 10-year lease term is expected to be approximately $400 million.

Upgrades to Submarine Fire Control Systems

General Dynamics Defense Systems (Pittsfield, Mass.) was awarded the $54 million second phase of a three-year omnibus contract that could be valued at a total of $180.2 million. Under the contract, General Dynamics Defense Systems will upgrade submarine fire control systems for both the British and U.S. navies. The contract also includes operational support, repair and return efforts and field engineering services.

Lifecycle Support to Submarine Propulsion Systems

General Dynamics Electric Boat (Groton, Conn.) yesterday received a $13.7 million contract modification for reactor-plant planning yard work. This work will encompass engineering services for lifecycle support, maintenance and modernization of the reactor plants and selected propulsion-plant systems of SSN-688 class and Trident class submarines, and the nuclear research submarine NR-1. Similar services also will be provided for all systems on the Navy’s moored training ships in Charleston, S.C.

Destroyer/Cruiser Maintenance and Support

Finally, NASSCO (San Diego, Calif.), was selected as the planning yard for maintenance and support of West Coast-based U.S. Navy destroyers and cruisers through 2004. The contract, including the initial year and four one-year options, has a potential maximum value of $68 million.

About General Dynamics

General Dynamics, headquartered in Falls Church, Virginia, has leading market positions in shipbuilding and marine systems, land and amphibious combat systems, information systems, and business aviation. The corporation employs approximately 44,000 people and has annualized sales of approximately $10 billion.

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Any "forward-looking statements" contained in this press release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

General Dynamics Corporation (ticker: GD, exchange: NYSE)
News Release - Friday, October 27, 2000
Press Contact: (703) 876-3190