Electric Boat awards Austal USA $450 million to expand production capacity

In an ASX regulatory filing, Australia’s Austal Limited (ASX:ASB) reports that its Austal USA subsidiary has been awarded a $450 million contract by General Dynamics Electric Boat. The contract will enable Austal USA to expand production capacity at its Mobile, Ala., shipyard in support of the U.S. Navy Submarine Industrial Base (SIB).

The Electric Boat award will fund Austal USA to enhance its existing infrastructure by designing, constructing and outfitting a new module fabrication and outfitting facility at its shipyard to support the U.S. Navy goal of delivering one Columbia-class and two Virginia-class submarines annually. Construction of the new building will start this fall and be complete in 2026.

When fully operational, the building will support approximately 1,000 jobs and provide capability to fabricate, outfit, and transport submarine components.

“General Dynamics Electric Boat has recognized that Austal USA is a solid partner to deliver high-quality components for Virginia- and Columbia-class submarines,” said Austal Limited CEO Paddy Gregg. “This growing partnership demonstrates confidence in Austal USA’s commitment to meet the needs of the U.S. maritime industrial base and support the most critical needs of the U.S. Navy.”

This latest planned expansion of Austal USA’s production facilities is the latest in an ongoing series. Back in July, the company broke ground on a new final assembly facility. To the south of the shipbuilder’s current facility, it will include a new assembly building, waterfront improvements, and a new shiplift system. The expansion will enable the erection of large steel modules for Navy and Coast Guard ships.