Wednesday, September 22, 2004

Oligopoly brief: General Dynamics General Dynamics is a leading company in the defense industry and in civil aviation. The company supplies defense systems, both hardware and software, to the United States and its allies, It is #1 in the world in business jets and #2 in naval shipbuilding. Its predecessor, the Electric Boat Company, was founded in 1899. The modern corporation took its name 1952. Through its Gulfstream division, the company is the leading seller of mid-size and intercontinental business jets, and a major provider of maintenance and refurbishment services for its own and others' jets. Gulfstream jets are owned by more than a quarter of Fortune 500 companies. General Dynamics' Combat Systems division supplies land and amphibious combat machines and systems, including armored vehicles, munitions and gun systems. It makes antitank weapons, aircraft gun systems,, naval gun systems, machine guns, and components for items from rockets logistics systems (shelters, bridges) for a moving army. In the civilian area, this division makes reinforced fuel tanks for hydrogen and gasoline. The Land Systems group makes such weapons as the Abrams Main Battle Tank, the Stryker armored vehicle, the Pansur and LAV armored personnel carriers, the Fox reconnaissance vehicle, the Wolverine bridge vehicle, and the RG family of multipurpose tactical vehicles. The company also supplies a number of weapons for US allies in Europe and other countries, through its Swiss MOWAG subsidiary, its Austrian Steyr-Daimler-Puch subsidiary, and its Spanish Santa Barbara Systems group. General Dynamics also makes ammunition and software combat systems for a number of armaments. The Information Systems and Technology division deals with military and intelligence data acquisition and processing. Its C4 Systems group specializes in secure transmission. The Advance Information Systems group provides technical services for intelligence efforts. The Network Systems division maintains voice, data, and video networks for government and business. The company's Marine Systems division designs and builds submarines, naval vessels, and some commercial ships. The company originated as the Electric Boat Company, the architect of nuclear submarines. It also owns Bath Iron Works and Nassco, major builders of surface vessels both military and commercial. American Overseas Marine operates supply ships for the US Navy. General Dynamics has built itself by a long series of acquisitions, swallowing up four to six companies a year. It has been particularly active in snapping up European companies of late. This gives it enormous power. US and some European forces have hardly anywhere else to turn for motorized armored vehicles, for example, and only a few others who can handle complex battlefield targeting systems or naval craft. It is in a position similar to that of Boeing, Raytheon, or Lockheed Martin, who have similarly wiped out most their competition in segments of the defense industry. At least some restraint has been put on the company. A1999 offer to buy Newport News Shipbuilders, one of the company's main naval ahip-making rivals, was quashed by the defense Dapartment, which saw the industry getting a little too concentrated. But, typically enough, that company was later bought ut by defense giant Northrop Grumman. The table below shows General Dynamics' activities in the last few years. Year Acquired Country Description 2001 Motorola Integrated Information Systems ( a division of Motorola) USA communications and technology systems for government and military   Santa Barbara Spain armaments company, owned by the Spanish government   Galaxy Aerospace USA maker of Galaxy and Astra commercial jets, now sold as Gulfstream models 2002 ATP (Advanced Technical Products USA US homeland security areas such as biological and chemical detection systems, as well as logistics systems   Eisenwerk Kaiserslautern Germany Germany floating bridges and ferries for military use   Command System Incorporated USA software for combat systems 2003 Steyr Spezialfahrzeug Austria armored vehicle maker   Digital System Resources USA signal processing for the Navy   IMCO, a division of Datron, Inc USA tactical ordnance   Veridian USA network protection and systems engineering   BBA Aviation UK private jet aftermarket service   Creative Technology Inc. USA technical systems and consulting for intelligence and defense   GM Defense (a division of General Motors) USA a maker of combat vehicles 2004 TriPoint Global Communications Systems USA satellite and wireless comminations   Spectrum Astro USA space systems and missile defense   Alvis PLC UK leading armored vehicle manufacturer in the UK and Scandinavia 8:14:12 PM

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