General Dynamics bags US$17b deal

[WASHINGTON] The US Navy on Monday awarded a US$17.6 billion contract for 10 more Virginia-class, nuclear-powered attack submarines to General Dynamics Corp and its major subcontractor, Huntington Ingalls Industries Inc, the largest-ever Navy shipbuilding contract.

The contract, which funds work on two Virginia-class submarines per year from fiscal year 2014 through 2018, will net savings of over US$2 billion, effectively giving the Navy 10 ships for the price of nine, said Navy Captain David Goggins, programme manager for the Virginia-class submarines.

Rear Admiral David Johnson, the Navy's programme executive officer for submarines, said the new contract would result in additional reductions in procurement costs and will also lower operating costs. "The Block IV award is the largest shipbuilding contract in US Navy history in terms of total dollar value and builds upon the Virginia-class programme's successful Navy and industry relationship," he said.