The Electric Boat unit of General Dynamics has received a $22 billion contract from the Navy to build the next nine Virginia-class attack submarines. EB, as it is called, will share the work with Huntington Ingalls Industries. However, Electric Boat is the prime contractor for both the Virginia-class sub and the Columbia-class ballistic missile sub that commences production in 2012, reflecting its dominant role in the world of undersea warfare. The two programs together ultimately will cost over a quarter trillion dollars to acquire, meaning EB and its partner are going to be prosperous for many years to come. In fact, General Dynamics says sales at Electric Boat are expected to double over the next decade, making it one of the most valuable franchises in U.S. defense. I have written a commentary for Forbes here.
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