About five years ago, Army work made up roughly 30 percent of Falls Church-based General Dynamics’s business. Today, that figure is down to 10 percent and dropping, said Phebe Novakovic, the company’s chief executive.
“Going forward, we’re going to reduce that exposure,” said Novakovic, whose company makes the iconic Abrams tank as well as a whole range of other combat vehicles, at a Barclays conference Thursday.
Still, she said that the vehicles and equipment that power ground warfare will remain relevant.
“In the history of warfare, nations only win wars by occupying territory,” Novakovic said. “The need for the U.S. Army hasn’t gone away.”
Novakovic also stressed that the contractor remains uninterested in pursuing acquisitions. When she took over as CEO last year, Novakovic put a halt to buying companies, calling the process “somewhat broken.”
In recent years, General Dynamics had bought several companies, including spending nearly $1 billion in 2011 on Arlington-based Vangent, a federal contractor that specializes in health care services. It also picked up IPW Holdings, the parent of IP Wireless, which provides network equipment for first responders and the military, and cybersecurity company Fidelis Security Systems.
Thursday, Novakovic said new acquisitions are simply not on her radar.
“If you overpay for an acquisition, it’s almost impossible to make it up,” she said. “We’re not doing it. Period.”