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U.S. Army Awards General Motors, General Dynamics $4 Billion Contract

20 November 2000

Contract to Supply New Armored Vehicles

    STERLING HEIGHTS, Mich. - The U.S. Army has awarded GM GDLS Defense Group, 
a joint venture between General Motors and General Dynamics Land Systems, a 
six-year requirements contract with an estimated total value of $4 billion to 
equip its new Brigade Combat Teams with the General Motors LAV III eight-wheeled 
armored vehicle.

    "We are truly honored to have been selected by the U.S. Army to equip our
nation's brigades with the General Motors LAV III armored vehicle, said Harry
J. Pearce, Vice Chairman, General Motors Corporation.  "On behalf of General
Motors and our defense unit, I'd like to commend General Shinseki, Chief of
Staff of the U.S. Army, for his vision to transform the army for the 21st
century into a more agile force through the use of wheeled vehicles.  GM is
proud to have partnered with General Dynamics and we share the army's
confidence in our products and people."

    "This is a strategically important award for General Dynamics," said
Arthur J. Veitch, General Dynamics Senior Vice President.  "It is the result
of a decision we made a few years ago to change our product offering to match
the requirements of our customer rather than to continue to focus only on the
products that we historically produced.  As a result, we entered into a
teaming agreement with General Motors which optimized the strengths of both
companies to meet the Army's transformation requirements.  The success of that
strategy can be seen with this contract award."

    The Army requirements-based contract is to equip up to six Brigade Combat
Teams, 2,131 vehicles, through a series of delivery orders starting this year.
The initial delivery order will be for $61.7 million in Research, Development,
Test and Evaluation; the second order for 366 production vehicles is worth
$578.4 million.

    The LAV III is a full-time four-wheel drive, selective eight-wheel drive,
armored vehicle weighing approximately 19 tons.  It can attain speeds of 62
mph on the highway and has a maximum range of 312 miles.  The basic infantry
carrier vehicle (ICV) has armor that protects the two-man crew and nine on-
board soldiers from machine gun bullets, mortar and artillery fragments.  The
LAV III ICV variant includes configurations such as the reconnaissance, anti-
tank guided missile, and medical evacuation vehicles, as well as carriers for
mortars, engineer squads, command groups, reconnaissance and fire support
teams.  The Mobile Gun System variant consists of a General Dynamics Land
Systems 105mm cannon mounted in a low-profile turret integrated on the General
Motors LAV III chassis.

    General Motors and General Dynamics will share fabrication and final
assembly of the vehicles among plants at Anniston, Alabama; Lima, Ohio; and
London, Ontario.

    GM Defense is a group of GM-owned business units engaged in the design and
production of Light Armored Vehicles and supporting turret systems for
military use around the world.  The group comprises research, design, and
manufacturing facilities in London, Ontario; Goleta, California; Troy,
Michigan; Kreuzlingen, Switzerland; and Adelaide, Australia.  Operations
within GM Defense have more than 50 years of experience in the design,
manufacture, and delivery of a unique family of light armored vehicles.  Those
vehicles are in service with the United States Marine Corps, the United States
Army National Guard, and with other military forces around the globe.

    General Dynamics Land Systems is a wholly owned subsidiary of General
Dynamics .  General Dynamics, headquartered in Falls Church,
Virginia, employs approximately 44,000 people worldwide and has annualized
sales of approximately $10 billion.  The company has leading market positions
in business aviation, information systems, shipbuilding and marine systems,
and land and amphibious combat systems.