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General Dynamics Partners with Heckler & Koch to Create U.S. Source for XM8 Modular Weapon System

FALLS CHURCH, Va. – General Dynamics European Land Combat Systems, a business unit of General Dynamics (NYSE: GD), and Heckler & Koch GmbH of Oberndorf, Germany, have created a U.S.-based joint venture company to manufacture and deliver the 5.56mm XM8 Light Weight Modular Carbine System to U.S. government customers.

Art Veitch, General Dynamics executive vice president for Combat Systems, said, “This partnership expands General Dynamics’ ability to meet the varied requirements of the U.S. infantry soldier, our traditional customer, while providing the government with a domestic supply of a crucial transformational weapon system. We look forward to working with Heckler & Koch to achieve the full U.S. market potential for this excellent weapon.”

The XM8 Light Weight Modular Weapon System has been proposed as a replacement for the current M16 rifle and M4 carbine, the standard infantry weapons in today's U.S. military. The XM8’s action is based on the Heckler & Koch G36, a proven infantry weapon. Different barrels and other modules can be swapped quickly to meet changing mission requirements. Variants include the baseline carbine, a sub-machine gun-like personal defense weapon, a sharpshooter’s configuration and a variant for use as a heavy-duty machine gun for sustained rapid-fire applications. An optional add-on 40mm grenade launcher is also available.

Heckler & Koch, a leader in the design and manufacturing of technologically advanced firearms for defense and law enforcement, is the firm behind some of the most well known firearms of the last fifty years including the G3 rifle, MP5 submachine gun, USP pistol, and newer models such as the MP7 Personal Defense Weapon, the UMP submachine gun, and the G36 weapon system. The company has U.S. operations based in Sterling, Va.

General Dynamics European Land Combat Systems is a business unit within the General Dynamics Combat Systems group. The unit is composed of the three European land combat systems companies owned by General Dynamics: MOWAG AG, of Kreuzlingen, Switzerland; General Dynamics Santa Barbara Sistemas, of Madrid, Spain; and Steyr Spezialfahrzeug, based in Vienna, Austria.

General Dynamics, headquartered in Falls Church, Virginia, employs approximately 71,600 people worldwide and anticipates 2004 revenue in excess of $19 billion. The company is a market leader in mission-critical information systems and technologies; land and expeditionary combat systems, armaments and munitions; 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, January 3, 2005
Press Contact: (703) 876-3199

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