General Dynamics and American Rheinmetall contract

General Dynamics and American Rheinmetall were awarded firm fixed price development contracts and will split $1.6 billion, with a requirement that will absorb all the cost overruns continuing into advanced development and each building as many as 11 prototypes vehicles. The service intends to award production to one company in fiscal 2027, officials told reporters on Monday, with fielding of the first vehicles in 2029. The Army will decide by 2027 how many of the vehicles it will buy.

Replacing the Bradley is part of a broader modernization plan across the U.S. Army, including efforts to improve firing precision over long distances, upgrading missile defenses and development of a new combat vehicle and a new helicopter.

The new vehicle, dubbed the “XM-30 Mechanized Infantry Combat Vehicle,” will have a 50mm cannon and antitank missiles. The service anticipates equipping its first unit in fiscal 2029. The new tracked vehicle is expected to have a hybrid electric engine, carry up to six passengers and include a 50 millimeter turret mounted gun, as well as other machine guns and antitank weapons. According to the Army, some of the functions of the vehicle would be autonomous.

Designed to combat the Soviet Union, the Bradley vehicle has been an Army mainstay since the 1980s and has found a new role as the Biden administration has committed 109 of them to Ukraine for its fight against Russia’s invasion.

Other competitors for the replacement had been Oshkosh Corp., BAE Systems Plc, and Point Blank Enterprises Inc.

The Army has struggled to replace the Bradley over a number of years, with a previous attempt abandoned. As per the Army Assistant Secretary for Acquisition Doug Bush, several past efforts to replace the M-2 Bradley were canceled for program and cost reasons, but “this one is going to succeed”.

The Bradley was first used in the 1991 Persian Gulf War. It was one of the “big five” modernization programs in the 1980s along with the M1 tank, AH-64 Apache helicopter, UH-60 Black Hawk transport and Patriot missile air defense system.

It is anticipated that two of the vehicles could fit in the belly of the C-17 cargo jet, one of the largest planes regularly used by the military to transport equipment.

Trading session

General Dynamics (GD) closed at $214.45, marking a -1.42% move from the prior day. This move lagged the S&P 500’s daily gain of 0.37%. Elsewhere, the Dow lost 0.01%, while the tech-heavy Nasdaq lost 1.26%.

The Rheinmetall AG stock price fell by -4.18% on the last day from 255.90€ to 245.20€. It has now fallen 3 days in a row.

General Dynamics and American Rheinmetall reaction

Gordon Stein, vice president and general manager of U.S. operations at General Dynamics, told Defense News in a statement that his company’s “highly affordable OMFV development approach maximizes performance to the Army’s requirements, and delivers a vehicle that is purpose-built for the mission.”

Matt Warnick, American Rheinmetall’s managing director, told Defense News, the company, with its teammates “will deliver a vehicle with the most modern protection, firepower, mobility, and power generation capabilities available.”

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