General Dynamics Electric Boat

History

The company was founded in 1899 by Isaac Rice as the Electric Boat Company to build John Philip Holland's submersible designs, which were developed at Lewis Nixon's Crescent Shipyard in Elizabeth, New Jersey. Holland VI was the first submarine that this shipyard built, later renamed USS Holland (SS-1). On 11 April 1900, it became the first modern submarine to be purchased and commissioned into the United States Navy. The success of Holland VI created a demand for follow-up models (A-class or Plunger class) that began with the prototype submersible Fulton built at Electric Boat (EB). Some foreign navies were interested in John Holland's latest submarine designs, and so purchased the rights to build them under licensing contracts through the Electric Boat Company; these included Great Britain's Royal Navy, Japan's Imperial Japanese Navy, Russia's Imperial Russian Navy, and the Netherlands' Royal Netherlands Navy.

During the World War I era, the company and its subsidiaries (notably Elco) built 85 submarines via subcontractors and 722 submarine chasers for the US Navy, and 580 80-foot motor launches for the British Royal Navy. After the war, the US Navy did not order another submarine from the company until Cuttlefish in 1931. During World War II, the company built 74 submarines, while Elco built nearly 400 PT boats. Electric Boat ranked 77th among United States corporations in the value of World War II military production contracts.

In 1952, Electric Boat was reorganized as General Dynamics Corporation under John Jay Hopkins. General Dynamics acquired Convair the following year, and the holding company assumed the "General Dynamics" name, with the submarine building operation reverting to the "Electric Boat" name.

Electric Boat built the first nuclear submarine USS Nautilus which was launched in January 1954, and the first ballistic missile submarine USS George Washington in 1959. Submarines of the Ohio-, Los Angeles-, Seawolf-, and Virginia-classes were also constructed by Electric Boat.

In 2002, Electric Boat conducted preservation work on the Nautilus, preparing her for her berth at the US Navy Submarine Force Library and Museum in Groton, Connecticut, where she now resides as a museum. Electric Boat's first submarine Holland was scrapped in 1932.

In the early 1980s, structural welding defects had been covered up by falsified inspection records; this led to significant delays and expenses in the delivery of several submarines being built at the Electric Boat Division shipyard. In some cases, the repairs resulted in practically dismantling and then rebuilding what had been a nearly completed submarine. The yard tried to pass the vast cost overruns directly on to the Navy, while Admiral Rickover demanded from Electric Boat's general manager P. Takis Veliotis that the yard make good on its "shoddy" workmanship.

The Navy eventually settled with General Dynamics in 1981, paying out $634 million of $843 million in Los Angeles class submarine cost-overrun and reconstruction claims. As it happened, the United States Navy was also the yard's insurer, liable to compensate the yard for losses and other mishaps. The concept of reimbursing General Dynamics under these conditions was initially considered "preposterous," in the words of Secretary of the navy John Lehman, but the eventual, legal basis of General Dynamics' reimbursement claims to the Navy for the company's poor workmanship included insurance compensation.

Veliotis was subsequently indicted by a federal grand jury under racketeering and fraud charges in 1983 for demanding $1.3 million in kickbacks from a subcontractor. He nonetheless eventually escaped into exile and a life of luxury in his native Greece, where he remained a fugitive from U.S. justice.

Electric Boat overhauls and undertakes repair work on fast attack class boats. The company built the Ohio-class ballistic missile submarines and Seawolf-class submarines, as well as others. However, most of the work done in the shipyard today is focused on construction of the Virginia-class, notably the new Block III evolution.

In April 2014, General Dynamics Electric Boat was awarded a $17.8 billion contract with U.S. Naval Sea Systems Command for ten Block IV Virginia-class attack submarines (SSN-774). It is the largest single shipbuilding contract in the service’s history. The Company builds the submarine along with Huntington Ingalls Industries Newport News Shipbuilding.

The boats of Block IV Virginia will cost less than Block III. Electric Boat decided to reduce the cost of the submarines by increasing efficiency in the construction process. The submarines of this type will build on the improvements to allow the boats to spend less time in the yard.