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General Dynamics Completes Acquisition of GM Defense

FALLS CHURCH, Va. – General Dynamics (NYSE: GD) has completed its acquisition of General Motors Defense for $1.1 billion in cash. General Motors Defense of London, Ontario, is a business unit of General Motors Corporation (NYSE: GM, GMH) of Detroit, Michigan. The transaction, which had been announced on December 19, 2002, is immediately accretive to General Dynamics’ earnings.

General Dynamics and GM Defense have been partners in a joint venture to produce Stryker, the U.S. Army’s transformational combat vehicle. The Army has accepted more than 400 of the 2,131 Strykers it will buy in this $4 billion program. Other GM Defense products include the LAV (Light Armored Vehicle) for Canada, Australia, New Zealand and Saudi Arabia; and the Piranha combat vehicle for a number of international customers. GM Defense had 2002 revenues of approximately $950 million; it has a funded backlog of more than $1.4 billion.

“Through our joint venture on Stryker, we’ve gained a great appreciation for the quality of the GM Defense work force, management team and products,” said General Dynamics Chairman and CEO Nicholas D. Chabraja. “In this transaction, a valued partner becomes part of our company. We are confident that this superb business will thrive and grow as part of General Dynamics Land Systems.”

GM Defense has 2,400 employees in locations around the world. The new units will be known as General Dynamics Land Systems-Canada (London, Ontario); General Dynamics Land Systems-California Technical Center (Goleta, California); Mowag (Kreuzlingen, Switzerland); General Dynamics Land Systems-Australia (Adelaide, South Australia) and General Dynamics -Middle East (Saudi Arabia).

General Dynamics, headquartered in Falls Church, Virginia, employs approximately 54,000 people worldwide and had 2002 revenues of $13.8 billion. The company has leading market positions in land and amphibious combat systems, mission-critical information systems and technologies, shipbuilding and marine systems, and business aviation.

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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 - Monday, March 3, 2003
Press Contact: (703) 876-3190