General Dynamics Stock Price Target Raised to $295 by Argus Analyst

General Dynamics Electric Boat has been awarded a $12.4 billion contract modification for two Virginia-class submarines, with potential value of $17.2 billion. The funding will enhance shipyard productivity, support workforce, and increase wages for employees working on nuclear-powered vessels. The submarines are designed for a broad range of missions, including anti-submarine and surface ship warfare, and special operations support.

General Dynamics Electric Boat (GDEB) has been awarded a $12.4 billion contract modification by the U.S. Navy for the construction of two Virginia-class submarines. The contract, which includes options that could bring the cumulative value to $17.2 billion, is set to enhance shipyard productivity, support the workforce, and increase wages for employees working on nuclear-powered vessels [1].

The contract, announced on April 30, 2025, was secured through a collaborative effort with the Navy, Congress, and the administration over the past two years. Mark Rayha, president of GDEB, stated, "This contract modification validates the unique and important role submarines and submarine builders play in our national defense" [3].

The Virginia-class submarines are designed to meet the full range of 21st-century mission requirements, including anti-submarine and surface ship warfare, as well as special operations support. GDEB, the prime contractor and lead design yard for the Virginia-class submarine series, constructs these submarines in collaboration with HII's Newport News Shipbuilding in Virginia [2].

The contract will also fund investments to improve shipyard processes and systems, ensuring that the submarines meet the latest technological standards. This contract is a significant milestone for GDEB, which employs over 24,000 people and is part of the global aerospace and defense company General Dynamics [4].

The Virginia-class submarine program is crucial for the U.S. Navy as it aims to replace the aging Los Angeles-class fleet. With 40 submarines produced and 24 in active service, the program continues to expand, with 16 submarines still under construction or waiting to be delivered [2].

The work on these submarines is estimated to be completed by June 2036, with the majority of the construction taking place in Virginia and Connecticut. This contract will not only boost GDEB's workforce but also contribute to the overall productivity of the shipyards, ensuring that the U.S. Navy maintains its edge in naval capabilities [1].

References:
[1] https://www.renewableenergymagazine.com/miscellaneous/general-dynamics-electric-boat-awarded-12b-contract-20250506
[2] https://www.marineinsight.com/shipping-news/general-dynamics-secures-12-billion-u-s-navy-contract-for-2-more-virginia-class-submarines/
[3] https://www.prnewswire.com/news-releases/general-dynamics-electric-boat-awarded-12-billion-contract-modification-for-virginia-class-submarines-302443368.html
[4] https://www.stocktitan.net/news/GD/general-dynamics-electric-boat-awarded-12-billion-contract-zkunyai71q9t.html