VOL. XCIV, NO. 247
★ WIDE MOAT STOCKS & COMPETITIVE ADVANTAGES ★
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Tuesday, December 30, 2025
General Dynamics Corporation
GD · New York Stock Exchange
Weighted average of segment moat scores, combining moat strength, durability, confidence, market structure, pricing power, and market share.
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Overview
General Dynamics is a U.S. defense and aerospace company with four reported segments: Aerospace (Gulfstream and Jet Aviation), Marine Systems (nuclear submarines and surface ships), Combat Systems (land vehicles and munitions), and Technologies (C5ISR and federal IT). Marine Systems is the strongest moat, anchored by Electric Boats role in the U.S. nuclear shipbuilding duopoly and multi-decade submarine programs. Combat Systems benefits from entrenched positions on major U.S. Army platforms (Abrams and Stryker) that drive modernization and sustainment pull-through. Technologies leans on cleared workforce access and specialized compliant products (e.g., NSA Type 1 crypto), while Aerospace relies on premium brand and a global service footprint in an oligopolistic market. Market cap is about $92B (Yahoo Finance as of 2025-12-26).
Primary segment
Marine Systems (Nuclear subs + surface shipbuilding)
Market structure
Duopoly
Market share
45%-55% (estimated)
HHI: 5,000
Coverage
4 segments · 8 tags
Updated 2025-12-29
Segments
Aerospace (Gulfstream + Jet Aviation)
Large-cabin business jet aircraft manufacturing and aircraft services (FBO, MRO, completions, charter, etc.)
Revenue
23.6%
Structure
Oligopoly
Pricing
moderate
Share
—
Peers
Marine Systems (Nuclear subs + surface shipbuilding)
U.S. Navy nuclear-powered submarine construction and major surface combatant shipbuilding/lifecycle services
Revenue
30.1%
Structure
Duopoly
Pricing
weak
Share
45%-55% (estimated)
Peers
Combat Systems (Land vehicles + munitions)
Land combat vehicles, armored platforms, and related munitions for U.S. and allied militaries
Revenue
18.9%
Structure
Oligopoly
Pricing
moderate
Share
—
Peers
Technologies (C5ISR + Federal IT)
Defense electronics (C5ISR), mission systems, cyber, and U.S. federal IT services
Revenue
27.5%
Structure
Competitive
Pricing
weak
Share
—
Peers
Moat Claims
Aerospace (Gulfstream + Jet Aviation)
Large-cabin business jet aircraft manufacturing and aircraft services (FBO, MRO, completions, charter, etc.)
FY2024 segment revenue/operating earnings used to derive revenue_share and operating_profit_share (GD Form 10-K for year ended 2024-12-31).
Brand Trust
Demand
Brand Trust
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Premium positioning and reputation in business aviation supports pricing and repeat purchases, especially in large-cabin categories.
Erosion risks
- Product parity narrows differentiation in large-cabin jets
- Safety/quality event damages reputation
- Business-jet demand is cyclical and sensitive to macro/credit conditions
Leading indicators
- Net order intake and cancellations
- Backlog and customer deposits trend
- Residual values of key Gulfstream models in secondary market
Counterarguments
- Competitors can match features over time and compete on price
- Brand alone does not prevent customers from switching on new model cycles
Service Field Network
Supply
Service Field Network
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Global FBO/MRO footprint and AOG support increases customer retention and supports higher aircraft-services capture across the installed base.
Erosion risks
- Independent MRO/FBO networks expand and win share
- OEM competitors expand captive service networks
Leading indicators
- Aircraft services revenue growth vs fleet growth
- Service margin trend
- Utilization at FBO/service locations
Counterarguments
- Customers can multi-home across service networks and shop for price
- Network effects are weaker when airports have multiple competing FBOs
Regulated Standards Pipe
Legal
Regulated Standards Pipe
Strength: 3/5 · Durability: medium · Confidence: 4/5 · 1 evidence
Type certification and airworthiness requirements raise barriers for new entrants and slow down copycat competition for new aircraft models.
Erosion risks
- Regulatory process improvements reduce time-to-certify
- Incumbents already have certification capabilities so barrier is industry-wide
Leading indicators
- Certification timelines for new models/derivatives
- Regulatory findings and audit outcomes
Counterarguments
- Certification is necessary but not sufficient for commercial success
- Other incumbents face the same regulatory bar
Marine Systems (Nuclear subs + surface shipbuilding)
U.S. Navy nuclear-powered submarine construction and major surface combatant shipbuilding/lifecycle services
FY2024 segment revenue/operating earnings used to derive revenue_share and operating_profit_share (GD Form 10-K for year ended 2024-12-31).
Capex Knowhow Scale
Supply
Capex Knowhow Scale
Strength: 5/5 · Durability: durable · Confidence: 5/5 · 1 evidence
Nuclear submarine construction requires specialized facilities, nuclear-qualified workforce, and accumulated program know-how; ongoing capex expands capacity.
Erosion risks
- Execution issues (labor, schedule, quality) reduce advantage
- Supply chain bottlenecks constrain throughput
- Budget reprioritization delays procurement
Leading indicators
- Virginia/Columbia schedule milestones and delivery cadence
- Shipyard labor availability and training throughput
- Supplier on-time delivery for long-lead components
Counterarguments
- Fixed-price risk and delays can compress margins despite moat
- Only one other peer exists, so relative advantage vs peer can narrow
Long Term Contracts
Demand
Long Term Contracts
Strength: 5/5 · Durability: durable · Confidence: 5/5 · 1 evidence
Multi-year/multi-decade submarine programs produce long backlog and visibility, making displacement difficult once programs are underway.
Erosion risks
- Contract renegotiations shift risk to shipyards
- Cost overruns lead to profit adjustments and customer pushback
Leading indicators
- Total backlog trend for Marine Systems
- Change orders and contract modifications
- Program budget line items in U.S. Navy submissions
Counterarguments
- Backlog does not guarantee profitability if estimates deteriorate
- Government can restructure procurement profiles even within programs
Government Contracting Relationships
Legal
Government Contracting Relationships
Strength: 5/5 · Durability: durable · Confidence: 5/5 · 2 evidence
Structural duopoly: U.S. nuclear shipbuilding is limited to two shipyards, creating persistent barriers and embedded Navy relationships.
Erosion risks
- Policy shift toward more competition or new build locations (low probability)
- Regulatory or safety issues constrain nuclear work authorization
- Foreign policy detente reduces fleet demand
Leading indicators
- Congressional shipbuilding appropriation trends
- NAVSEA contract awards and modifications
- Industrial base capacity expansion announcements
Counterarguments
- Customer is effectively a monopsony, limiting pricing/margins
- Workshare between the two yards can shift program-to-program
Combat Systems (Land vehicles + munitions)
Land combat vehicles, armored platforms, and related munitions for U.S. and allied militaries
FY2024 segment revenue/operating earnings used to derive revenue_share and operating_profit_share (GD Form 10-K for year ended 2024-12-31).
Design In Qualification
Demand
Design In Qualification
Strength: 5/5 · Durability: durable · Confidence: 5/5 · 1 evidence
Program incumbency on key U.S. Army platforms creates extremely high switching and requalification costs for replacing the prime OEM.
Erosion risks
- Army shifts to new platforms/programs or changes acquisition strategy
- Competition in next-generation vehicle programs displaces incumbents
- Budget pressure reduces upgrade cadence
Leading indicators
- Program of record funding for Abrams/Stryker upgrades
- Contract awards for modernization and sustainment
- Installed base utilization and fleet life-extension plans
Counterarguments
- Sole-source position is program-specific and not guaranteed in future competitions
- Margins can still be constrained by contract terms and government audits
Procurement Inertia
Demand
Procurement Inertia
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Large installed base drives recurring modernization, spares, and sustainment demand over long fleet life cycles.
Erosion risks
- DoD increases competitive sourcing of sustainment/parts
- Allies diversify suppliers for geopolitical reasons
Leading indicators
- Aftermarket/service revenue mix within Combat Systems
- Recompete win rate on sustainment contracts
- Parts availability and depot throughput metrics
Counterarguments
- Sustainment can be competed even if OEM production is sole-source
- Government may push open systems architectures to reduce lock-in
Capacity Moat
Supply
Capacity Moat
Strength: 3/5 · Durability: medium · Confidence: 4/5 · 1 evidence
Expanding munitions capacity can create near-term advantage during demand spikes (when qualified capacity is scarce).
Erosion risks
- Competitors and governments expand capacity, reducing scarcity
- Demand normalization after conflict-driven surges
Leading indicators
- Capacity utilization rates at munitions facilities
- DoD multi-year procurement awards for munitions
- Supplier lead times for energetics and metals
Counterarguments
- Capacity can be replicated with time and government funding
- Munitions contracts may be price-competitive and margin-limited
Technologies (C5ISR + Federal IT)
Defense electronics (C5ISR), mission systems, cyber, and U.S. federal IT services
FY2024 segment revenue/operating earnings used to derive revenue_share and operating_profit_share (GD Form 10-K for year ended 2024-12-31).
Government Contracting Relationships
Legal
Government Contracting Relationships
Strength: 4/5 · Durability: durable · Confidence: 4/5 · 1 evidence
Deep U.S. government customer access and cleared workforce improve ability to win and execute sensitive programs.
Erosion risks
- Contract recompetes and price pressure in services
- Government insourcing reduces contractor scope
- Budget cuts or shifting agency priorities
Leading indicators
- Book-to-bill and funded backlog
- Recompete win rate and pipeline quality
- Cleared headcount and attrition
Counterarguments
- Many primes have similar clearances and relationships
- Agencies can break work into smaller bids to increase competition
Compliance Advantage
Legal
Compliance Advantage
Strength: 4/5 · Durability: durable · Confidence: 5/5 · 1 evidence
NSA Type 1 certification is difficult to obtain and supports entrenchment for classified communications and crypto products.
Erosion risks
- Technology shifts toward software-defined and commercial crypto stacks
- Security incident undermines trust in certified solutions
Leading indicators
- Program awards tied to classified communications
- Refresh cycle timing for crypto/COMSEC systems
- Certification renewals and new product approvals
Counterarguments
- Other defense primes also offer certified comms products
- Certification does not guarantee sole-source awards
Suite Bundling
Demand
Suite Bundling
Strength: 3/5 · Durability: medium · Confidence: 3/5 · 1 evidence
Complementary offerings across IT services and mission systems can improve win probability when customers prefer integrated solutions.
Erosion risks
- Customers unbundle to best-of-breed vendors
- Prime contract splits reduce ability to bundle
Leading indicators
- Win rate on integrated pursuits vs standalone bids
- Average contract size and scope breadth
- Subcontracting mix vs prime work
Counterarguments
- Bundling can be less attractive when agencies enforce modular contracting
- Point solutions from specialists can outperform integrated offerings
Evidence
We are recognized as a leading producer of business jets with industry-leading customer support.
Direct company statement supporting brand/reputation moat in Gulfstream.
Jet Aviation ... has a network of approximately 50 locations worldwide ... a leading global FBO network of approximately 30 facilities ...
Physical services network is an observable support/switching-cost moat for operators.
For an aircraft to be manufactured and sold, the model must receive a type certificate ... and ... a certificate of airworthiness.
Regulatory certification is a gating function for aircraft entry/changes.
Marine Systems ... a leading designer and builder of nuclear-powered submarines ... made substantial investments to expand our facilities ... and ... supply chain.
Supports scale/know-how and capital intensity as an entry barrier.
The Columbia class ... expected to span two decades and have a value in excess of $125 billion.
Program duration and scale support long-term contract/backlog moat.
Showing 5 of 16 sources.
Risks & Indicators
Erosion risks
- Product parity narrows differentiation in large-cabin jets
- Safety/quality event damages reputation
- Business-jet demand is cyclical and sensitive to macro/credit conditions
- Independent MRO/FBO networks expand and win share
- OEM competitors expand captive service networks
- Regulatory process improvements reduce time-to-certify
Leading indicators
- Net order intake and cancellations
- Backlog and customer deposits trend
- Residual values of key Gulfstream models in secondary market
- Aircraft services revenue growth vs fleet growth
- Service margin trend
- Utilization at FBO/service locations
Curation & Accuracy
This directory blends AI‑assisted discovery with human curation. Entries are reviewed, edited, and organized with the goal of expanding coverage and sharpening quality over time. Your feedback helps steer improvements (because no single human can capture everything all at once).
Details change. Pricing, features, and availability may be incomplete or out of date. Treat listings as a starting point and verify on the provider’s site before making decisions. If you spot an error or a gap, send a quick note and I’ll adjust.