General Dynamics (NYSE:GD) Awarded Armored Vehicle Contract with UK

General Dynamics Corp. (NYSE:GD) was awarded the contract to supply the British army with a new fleet of armored vehicles which is estimated to be worth billions over the 30-years the vehicles are expected to operate.

Although it is the U.K. wing of General Dynamics which won the contract, they beat out U.K.-based BAE Systems (LON:BA) to get the deal.

Much of this has come from growing dissatisfaction with the quality of the equipment provided to the British armed forces while in combat areas. It was noted the deal was struck just a relatively short time before elections are due to be held.

Initially the business generated for General Dynamics is about 2 billion British pounds, but as mentioned above, that will grow into multi-billions over the approximate 30 year life span of the vehicles.

The new vehicles will be a vast important over the Scimitar, which is now used by British troops. The new vehicle, dubbed the Scout, will offer better defensive protection for the soldiers, as well as much greater firepower. They will also be able to see farther and have improved sensors.

A part of the vehicle, the turret, has been subcontracted out to the British unit of Lockheed Martin.

General Dynamics UK President and Managing Director Sandy Wilson said about the deal, "The Ascod SV program is British to its bootstraps, delivering a military off-the-shelf vehicle with British design by British engineers to the British Army while safeguarding or creating 10,600 jobs for British workers."

Approximately 80 percent of the production of the armored vehicles will be in the U.K.