General Dynamics Unit Wins $309M Canadian Army Contract

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General Dynamics Corporation 's GD business unit, General Dynamics Land Systems has won a contract from the Government of Canada to upgrade 141 Light Armoured Vehicle ("LAV") III vehicles.

Contract Details

The contract is worth $308.7 million (CAD $404 million), which came after an LAV III upgrade contract awarded in 2011 and extended the service life for 550 vehicles upto the year 2035.

The latest contract is part of Canada's Light Armored Vehicle III Upgrade Program − to provide the country's military with updated ground-based platforms. This upgrade program delivers vehicles in the new LAV 6.0 configuration, which covers the life-saving double-V hull, development of protection and mobility, onboard vetronics and capability for future growth as well as modularity.

The upgrades will improve the performance and survivability of the Canadian vehicles and cut long-term maintenance costs. Additionally, it will also bring in reliability and accessibility of equipment for training and deployment.

About the LAV III Vehicles

The LAV III version is the third generation of the LAV family of Infantry fighting vehicle, which entered into service for the first time in 1999. It features double-V hull technology and add-on armour that provides crew members with the latest in protection against mine blasts, IEDs and other threats. The third version was built to respond to a need for greater payload and protection levels.

The LAV III has been purchased by different customers in a wide range of variants. In the 1997-2006 time frame, Canada obtained 651 vehicles that includes six variants of LAV III. The vehicle has been also deployed for operations in the Balkans, Africa, Haiti, and most recently in Afghanistan.

Why General Dynamics?

General Dynamics Land Systems is the leader in Light Armoured Vehicle platforms. It offers the forces with the most advanced technologies combined with combat-proven survivability.

General Dynamics has had a long-standing strategic alliance with the U.S. as well as international defense establishments, backed by its consistent efforts on trying to meet its commitments in terms of maintaining product and service standards, along with delivery timing.

Price Movement

General Dynamics's stock has improved about 41.6% in the last one year, outperforming the Zacks categorized Aerospace/Defense industry's gain of 34.1%. This could be because General Dynamics consistently maintains a strategic alliance with the U.S. Department of Defense, which allows it to enjoy a steady flow of contracts. The stock's performance is in line with that of its peers like Boeing Co. BA , Huntington Ingalls Industries Inc. HII and Engility Holdings, Inc. EGL .

Zacks Rank

General Dynamics currently has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank stocks here .

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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