RCON Stock
RCON Stock

A manufacturer of aerospace, marine and military equipment, General Dynamics Corporation (GD), may be the beneficiary of the Pentagon’s desire to get new ships for amphibious forces.

Market players noted the record high U.S. spending on a new military fleet, in which some ships cost $400,000 to clean one toilet. Perhaps the military realizes that it is unlikely to be feasible in the immediate future to construct a large series of ships, such as the Zumwalt-class destroyer, at a cost of $13 billion for three ships. Thus, the Pentagon has provided for a cost cap for the emerging amphibious forces in demand.

A series of 30 high-speed landing ships at a price of up to $130 million per unit is expected to be built, according to the Light Amphibious Warship (LAW) project plan. However, it’s also not cheap for a ship with a crew of 40 people without serious weapons (maximum 30-mm gun). The LAW will be only half as long as the U.S. amphibious docks ships. Unlike them, without the use of amphibious platforms, LAW will easily approach shore and land troops and armored vehicles directly on land.

Such swift vessels are in demand for the urgent delivery of Marine Corps units and special operations forces, and various designs have been tested by the US Navy for the last 30 years. Not only should such vessels land troops, but they should also provide urgent assistance to US citizens in remote regions.

The basic description and lack of costly weapon systems and sensors reduces the cost of LAW. This, among other things, should ensure the rapid construction of the entire series by the end of 2026. The $3-$4 billion contract is important, even for a company as large as General Dynamics. Under this deal, GD’s competitor is Huntington Ingalls Industries, Inc (HII).

General Dynamics Corporation (GD) stock was up 1.13% to $148.15 on Wednesday.


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