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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-3671

GENERAL DYNAMICS CORPORATION
(Exact name of registrant as specified in its charter)

Delaware 13-1673581
- -------- ----------
State or Other Jurisdiction of I.R.S. Employer
Incorporation or Organization Identification No.

3190 Fairview Park Drive, Falls Church, Virginia 22042-4523
- ------------------------------------------------ ----------
Address of principal executive offices Zip Code

Registrant's telephone number, including area code (703) 876-3000

Securities registered pursuant to Section 12(b) of the Act:

Name of Each Exchange
Title of Each Class on Which Registered
- ------------------- -----------------------
Common Stock, $1.00 Par Value New York Stock Exchange
Chicago Stock Exchange
Pacific Stock Exchange

9.95% Debentures Due 2018 New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
- -

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment of this Form 10-K.
---
The aggregate market value of the voting stock held by nonaffiliates
of the registrant was $3,560,534,408 at March 10, 1997, calculated in accordance
with the Securities and Exchange Commission rules as to beneficial ownership.

63,267,990 shares of the registrant's common stock were outstanding at
March 10, 1997.

DOCUMENTS INCORPORATED BY REFERENCE:

Parts I and II incorporate information from certain portions of the
registrant's Annual Report to security holders for the fiscal year ended
December 31, 1996 (1996 Shareholder Report).

Part III incorporates information from certain portions of the
registrant's definitive Proxy Statement for the 1997 annual meeting of
shareholders to be filed with the Securities and Exchange Commission within 120
days after the close of the fiscal year.

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2

GENERAL DYNAMICS CORPORATION

INDEX

PART I PAGE
----

Item 1. Business 1
Item 2. Properties 6
Item 3. Legal Proceedings 7
Item 4. Submission of Matters to a Vote of Security Holders 7
Supplementary
Item. Executive Officers of the Company 7

PART II

Item 5. Market for the Company's Common Equity and
Related Shareholder Matters 9
Item 6. Selected Financial Data 9
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
Item 8. Financial Statements and Supplementary Data 9
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 9

PART III

Item 10. Directors and Executive Officers of the Registrant 9
Item 11. Executive Compensation 9
Item 12. Security Ownership of Certain Beneficial Owners
and Management 9
Item 13. Certain Relationships and Related Transactions 10

PART IV

Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 10

SIGNATURES 11

PART I

ITEM 1. BUSINESS

INTRODUCTION

The primary business of General Dynamics (the company) is supplying
weapons systems and services to the U.S. government and its allies. The
company is a Delaware corporation formed in 1952 as successor to the Electric
Boat Company. Two of the company's primary operating units, General Dynamics
Land Systems Inc. and Bath Iron Works Corporation, were acquired in 1982 and
1995, respectively. On January 1, 1997, the company acquired the assets of
Defense Systems and Armament Systems, formerly business units of Lockheed
Martin Corporation. In addition, the company operates other smaller
businesses.

After divesting its tactical military aircraft, missile systems and
space launch systems businesses, the company comprises two major business
segments: Marine and Combat Systems Groups, as well as miscellaneous businesses
classified as Other. The Marine Group includes Electric Boat Corporation
(Electric Boat), Bath Iron Works Corporation (BIW) and American Overseas Marine
Corporation (AMSEA). The Combat Systems Group, formerly the Armored Vehicles
segment, includes General Dynamics Land Systems Inc. (Land Systems), General
Dynamics Defense Systems, Inc. (Defense Systems) and General Dynamics Armament
Systems, Inc. (Armament Systems). The Other business segment includes Freeman
Energy Corporation (Freeman Energy), Material Service Corporation (Material
Service) and Patriot I, II and IV Shipping Corporations (Patriots).
Information on revenues, operating profit or loss and identifiable assets
attributable to each of the company's three business segments is included in
Note Q to the Consolidated Financial Statements on page 36 of the 1996
Shareholder Report, filed as Exhibit 13 to this Annual Report on Form 10-K for
the year ended December 31, 1996, and is incorporated herein by reference. A
description of the company's products and services, competition, and other
related information follows.

PRODUCTS AND SERVICES

MARINE GROUP. Electric Boat designs and builds nuclear submarines for
the U.S. Navy, having contracts for the design of the New Attack Submarine
(NSSN), and for construction of the final Ohio class ballistic missile
submarine (Trident) and three Seawolf class attack submarines (Seawolf). In
addition, Electric Boat performs a broad range of engineering work including
advanced research and technology development, systems and component design
evaluation, prototype development and logistics support to the operating fleet.
Electric Boat also serves as ship integrator for certain components and
subassemblies of the submarines, such as electronic equipment. Net sales were
$1,443, $1,567 and $1,678 in 1996, 1995 and 1994, respectively.

BIW has contracts for the construction of 11 Arleigh Burke class
destroyers (DDG 51) and plays a lead role in providing design, engineering, and
ongoing life cycle support services for DDG 51 class ships. BIW is a member of
a three-contractor team which was recently selected to design and build the
Navy's new class of amphibious transport ships (LPD 17), and is the leader of a
team participating in the design of the Navy's arsenal ship. Net sales were
$791 in 1996.

AMSEA provides ship management services for five of the U.S. Navy's
Maritime Prepositioning Ships (MPS), nine of the U.S. Maritime
Administration's Ready Reserve Force ships (RRF) and two U.S. Maritime Army War
Reserve vessels (AWR-3). The MPS are under five-year contracts of which three
were renewed in 1995, and two were renewed in 1996. These contracts are
renewable through the year 2011. The RRF ships are in the fourth year of their
five-year contracts. The MPS and AWR-3 vessels operate worldwide; the RRF
vessels are located on the east, gulf and west coasts of the United States.

COMBAT SYSTEMS GROUP. Land Systems designs and manufactures the M1
Series Abrams Main Battle Tank for the U.S. Army, U.S. Marine Corps and
various foreign governments. Land Systems also performs engineering and
upgrade work, and provides support for existing armored vehicles. Production
of the M1A1, a version of the M1 that incorporates increased firepower,
additional crew protection features and improved armor, was initiated in 1985.
Production of the M1A2, the latest version of the M1 that incorporates
battlefield management systems aimed at providing improved fighting ability, as
well as improved survivability of the tank's four crew members, was initiated
in 1992. Land Systems has a multiyear contract with the U.S. Army to upgrade
120 tanks per year for the next four years from the M1 to the M1A2 version.

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In addition to its tank production, Land Systems participates in four
other armored vehicle programs. The first is the Advanced Amphibious Assault
Vehicle (AAAV) program for which Land Systems was recently awarded a
development contract, including design and construction of at least three
prototypes. The second is a four-year program to upgrade 62 Fox Nuclear,
Biological and Chemical Reconnaissance System vehicles. The third is the Heavy
Assault Bridge program which is currently under development and is expected to
enter production late in this decade. The fourth is the Crusader
Self-Propelled Howitzer development program of which the company's share is
approximately 25 percent. Teamed with Tadiran Ltd. of Israel, Land Systems is
also a producer of the Single Channel Ground and Airborne Radio System
(SINCGARS).

To extend its product lines, Land Systems purchased the assets of
Teledyne Vehicle Systems (Muskegon Operations) in March 1996. Muskegon
Operations specializes in combat vehicles as well as mobility systems,
suspension technology and diesel engines for armored vehicle markets
world-wide.

The recent acquisition of Defense Systems and Armament Systems expands
the company's participation in armored vehicles from heavy tanks to light
vehicles, and from full platforms to major subsystems. Defense Systems builds
light vehicles, turrets and transmissions for combat vehicles, as well as
missile guidance and naval fire control systems. Armament Systems designs,
develops and produces advanced gun and ammunition handling systems based on the
Gatling principal for application on fixed-wing aircraft, helicopters, surface
vehicles and naval ships. General Dynamics Ordnance Systems, Inc., a
subsidiary of Armament Systems, is a leader in the production of ammunition and
ordnance products and operates the Milan Army Ammunition Plant in Milan,
Tennessee, for the U.S. Army.

OTHER. Freeman Energy mines coal, producing approximately 5 million
tons in each of the last three years. Freeman Energy owns or leases rights to
over 600 million tons of coal reserves in Illinois.

Material Service is engaged in the mining and sale of aggregates (e.g.
stone, sand and gravel) for use in the construction of highways and other
infrastructure projects, and for commercial and residential building
construction primarily in northern and central Illinois. This business is
cyclical and seasonal in nature, and therefore, sales and earnings fluctuate.

Patriots are financing subsidiaries that lease liquefied natural gas
tankers to a nonaffiliated company.

COMPETITION

Historically, competition for U.S. government defense contracts was
characterized by a number of major companies competing for a variety of weapon
system contracts. The customer's procurement policy generally required
competitive bids based on strict product specifications. In addition, the
customer often awarded more than one company contracts in order to ensure
competition on subsequent contracts.

In recent years, due to reduced defense spending, the industry has
consolidated through mergers and acquisitions to maintain critical mass
resulting in fewer and larger competitors. With fewer programs available to
win, companies frequently have formed strategic alliances to become more
competitive in pursuing these programs. The customer faces challenges due to
the reduction in available procurement funds as it must address industrial base
issues while assessing competing needs between and among the various branches
of the service. Finally, Congress continues to be very influential in its role
of selecting which programs to fund and at what level based on limited budget
dollars. As a result, the defense procurement policy is evolving and will be
affected by these various and sometimes conflicting factors.

A discussion of competition on individual programs is included in
Management's Discussion and Analysis of the Results of Operations and Financial
Condition on pages 18 through 22 of the 1996 Shareholder Report, filed as
Exhibit 13 to this Annual Report on Form 10-K and incorporated herein by
reference.

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GENERAL INFORMATION

U. S. Government Contracts

The company's net sales to the U.S. government include Foreign
Military Sales (FMS). FMS are sales to foreign governments through the U.S.
government, whereby the company contracts with and receives payment from the
U.S. government and the U.S. government assumes the risk of collection from
the customer. The company's largest FMS sales are M1 tanks and related
services, including training in operation and maintenance, and other logistical
support. U.S. government sales were as follows (excluding discontinued
operations; dollars in millions):

Year Ended December 31
--------------------------------------
1996 1995 1994
------ ------ ------

Domestic $3,051 $2,422 $2,190
FMS 261 476 690
------ ------ ------
Total U.S. government $3,312 $2,898 $2,880
====== ====== ======
Percent of net sales 92% 94% 94%

All U.S. government contracts are terminable at the convenience of the
U.S. government, as well as for default. Under contracts terminable at the
convenience of the U.S. government, a contractor is entitled to receive
payments for its allowable costs and, in general, the proportionate share of
fees or earnings for the work done. Contracts which are terminated for default
generally provide that the U.S. government only pays for the work it has
accepted and may require the contractor to pay for the incremental cost of
reprocurement and may hold the contractor liable for damages. In 1991, the
U.S. Navy terminated for default a contract with the company and McDonnell
Douglas Corporation for the full-scale development of the U.S. Navy's A-12
aircraft. In December 1995 the U.S. Court of Federal Claims issued an order
converting the termination for default to a termination for convenience. For
further discussion, see Note N to the Consolidated Financial Statements on page
33 of the 1996 Shareholder Report, filed as Exhibit 13 to this Annual Report on
Form 10-K and incorporated herein by reference.

Companies engaged in supplying goods and services to the U.S.
government are dependent on congressional appropriations and administrative
allotment of funds, and may be affected by changes in U.S. government policies
resulting from various military and political developments. U.S. government
defense contracts typically involve long lead times for design and development,
and are subject to significant changes in contract scheduling. Often the
contracts call for successful design and production of very complex and
technologically advanced items.

Foreign Sales and Operations

The major portion of sales and operating earnings of the company for
the past three years was derived from operations in the United States. Although
the company purchases supplies from and subcontracts with foreign companies, it
has no substantial operations in foreign countries. The majority of foreign
sales are made as FMS through the U.S. government, but certain direct foreign
sales are made of components and support services. Direct foreign sales were
$38, $29 and $32 in 1996, 1995 and 1994, respectively. Direct foreign sales
are expected to increase in 1997 with the acquisition of Armament Systems and
Defense Systems, which generated sales of $53 and $32 respectively in the
international market in 1996.

Supplies

Many items of equipment and components used in the production of the
company's products are purchased from other manufacturers. The company is
dependent upon suppliers and subcontractors for a large number of components
and the ability of its suppliers and subcontractors to meet performance and
quality specifications and delivery schedules. In some cases the company is
dependent on one or a few sources, either because of the specialized nature of
a particular item or because of domestic preference requirements pursuant to
which it operates on a given project.

All of the company's operations are dependent upon adequate supplies
of certain raw materials, such as aluminum and steel, and on adequate supplies
of fuel. Fuel or raw material shortages could also have an adverse effect on
the company's suppliers, thus impairing their ability to honor their
contractual commitments to the company. The company has not experienced
serious shortages in any of the raw materials or fuel supplies that are
necessary for its production programs.

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6
Research and Development

Research and development activities in the Marine and Combat Systems
Groups are conducted principally under U.S. government contracts. These
research efforts are concerned with developing products for large systems
development programs or performing work under research and development
technology contracts. In 1996, the company experienced a decline in
customer-sponsored expenditures for research and development due primarily to
the NSSN program at Electric Boat moving to the design phase. In addition, the
defense businesses engage in independent research and development, of which a
significant portion is recovered through overhead charges to U.S. government
contracts.

The table below details expenditures for research and development
(excluding discontinued operations; dollars in millions):

Year Ended December 31
---------------------------------
1996 1995 1994
---- ---- ----

Company-sponsored $ 38 $ 25 $ 30
Customer-sponsored 89 178 246
---- ---- ----
$127 $203 $276
==== ==== ====

Backlog

Summary backlog information for each business segment follows:

December 31 1996 Backlog
-------------------------- Not Filled
1996 1995 in 1997
--------- ------- -------

Marine Group $ 7,566 $5,686 $5,123
Combat Systems Group 2,057 1,103 1,255
Other 727 597 666
------- ------ ------
Total Backlog $10,350 $7,386 $7,044
======= ====== ======
Funded Backlog $ 6,161 $5,227 $3,308
======= ====== ======

Total backlog represents the estimated remaining sales value of work
primarily performed under authorized U.S. government contracts. Funded backlog
represents the portion of total backlog that has been appropriated by Congress
and funded by the procuring agency. To the extent backlog has not been funded,
there is no assurance that congressional appropriations or agency allotments
will be forthcoming. Total backlog also includes amounts for long-term coal
contracts. For further discussion, see Management's Discussion and Analysis of
the Results of Operations and Financial Condition on pages 18 through 22 of the
1996 Shareholder Report, filed as Exhibit 13 to this Annual Report on Form 10-K
and incorporated herein by reference.

Environmental Controls

The 1990 Clean Air Act (Act) had a significant impact on Freeman
Energy. The Act requires, among other things, a phased reduction in sulfur
dioxide emissions by coal burning facilities. Virtually all of the coal in
Freeman Energy's Illinois basin mines has medium or high sulfur content.
Freeman Energy's two long-term contract customers have clean coal technologies
which allow for utilization of Freeman Energy's coal under the new regulations.
Freeman Energy has targeted customers with clean coal technology to mitigate
the impact of regulations in the near term. The long-term impact of the Act is
not known.

Federal, state and local requirements relating to the discharge of
materials into the environment and other factors affecting the environment have
had and will continue to have an impact on the manufacturing operations of the
company. Thus far, compliance with the requirements has been accomplished
without material effect on the company's capital expenditures, earnings or
competitive position. While it is expected that this will continue to be the
case, the company cannot assess the possible effect of compliance with future
requirements.

Additional information relating to the impact of environmental
controls is included under the caption "Environmental" in Note M to the
Consolidated Financial Statements on page 32 of the 1996 Shareholder Report,
filed as Exhibit 13 to this Annual Report on Form 10-K, and is incorporated
herein by reference.

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Patents

Numerous patents and patent applications are owned by the company and
utilized in its development activities and manufacturing operations. In many
cases, however, the U.S. government has an irrevocable, non-exclusive,
royalty-free license, pursuant to which the government may use or authorize
others to use the inventions covered by the patents. Pursuant to similar
arrangements, the government may consent to the company's use of inventions
covered by patents. Patents and licenses are important in the operation of the
company's business, as one of management's key objectives is developing and
providing its customers with advanced technological solutions.

Employees

At December 31, 1996, the company had approximately 23,100 employees,
of whom approximately 60 percent were covered by collective bargaining
agreements with various unions, the most significant of which are the
International Association of Machinists and Aerospace Workers, the Industrial
Union of Marine and Shipbuilding Workers of America, the Metal Trades Council
of New London, Connecticut, the United Auto Workers Union, the Office and
Professional Employees International Union and the United Mine Workers of
America. During 1997, bargaining agreements with the United Auto Workers Union
and the Industrial Union of Marine and Shipbuilding Workers of America are
scheduled to expire and are subject to negotiations with the respective unions.

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ITEM 2. PROPERTIES

A summary of floor space at the main facilities of the Marine and
Combat Systems Groups follows (square feet in millions):

COMPANY GOVERNMENT
OWNED LEASED FURNISHED
FACILITIES FACILITIES FACILITIES TOTAL
--------------- ------------- -------------- -------------

MARINE GROUP:

Electric Boat
Groton, Connecticut 2.6 2.6
Quonset Point, Rhode Island 0.4 1.1 1.5
Avenel, New Jersey 0.4 0.4

Bath Iron Works
Bath, Maine 1.1 1.1
East Brunswick, Maine 0.6 0.6
Portland, Maine 0.1 0.1
------ ------ ------ ------

TOTAL MARINE GROUP 5.1 1.2 0.0 6.3
====== ====== ====== ======

COMBAT SYSTEMS GROUP:

Land Systems
Lima, Ohio 1.6 1.6
Muskegon, Michigan 1.0 1.0
Scranton, Pennsylvania 0.3 0.3
Woodbridge, Virginia 0.1 0.1
Tallahassee, Florida 0.1 0.1

------ ------ ------- -------

TOTAL COMBAT SYSTEMS GROUP 1.1 0.4 1.6 3.1
====== ====== ======= =======

OTHER. Freeman Energy operates three underground mines and one
surface mine in Illinois. The Orient No. 6 underground mine was idled in early
1997. Coal preparation facilities and rail loading facilities are located at
each mine sufficient for its output.

Material Service operates several stone quarries, as well as sand and
gravel pits and yards in the Chicago, Illinois area for its aggregates
business.

REAL ESTATE HELD FOR DEVELOPMENT. As part of the sale of businesses,
certain related properties were retained by the company. These properties have
been segregated on the Consolidated Balance Sheet as real estate held for
development. The company has retained outside experts to support the
development of plans which are intended to maximize the market value of these
properties. These properties include 232 acres in Kearny Mesa and 2,420 acres
in Sycamore Canyon, both of which are in San Diego, California; and 363 acres
in Rancho Cucamonga, California. Most of this property is undeveloped. The
company owns 700,000 square feet of building space at Rancho Cucamonga and
200,000 square feet of building space at Sycamore Canyon. The buildings at
Kearny Mesa are currently in the process of demolition in preparation for
development activity.

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ITEM 3. LEGAL PROCEEDINGS

The information under the captions "Litigation" and "Environmental" in
Note M and the information in Note N to the Consolidated Financial Statements
appearing on pages 31 through 33 of the 1996 Shareholder Report, included in
this Annual Report on Form 10-K as Exhibit 13, is incorporated herein by
reference in response to this item.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted to a vote of the company's security holders
during the fourth quarter of the year ended December 31, 1996.

SUPPLEMENTARY ITEM. EXECUTIVE OFFICERS OF THE COMPANY

The name, age, offices and positions held for the last five years of
the company's executive officers who are not directors are as follows:

AGE AT
DECEMBER 31
NAME, POSITION AND OFFICE 1996
------------------------- ---------------

David D. Baier -- Vice President Taxes since August 1995; Staff Vice President Taxes 42
March 1994 -- August 1995; Corporate Tax Counsel and Director of Planning
and Litigation September 1991 -- March 1994

G. Kent Bankus -- Vice President Government Relations since April 1993; Staff Vice President 54
Aerospace Programs and Field Offices July 1991 -- April 1993

Edward C. Bruntrager -- Vice President and General Counsel since March 1994; Assistant General 49
Counsel January 1987 -- March 1994

Allan C. Cameron -- Vice President of the company and President of Bath Iron Works since 50
March 1996; Executive Vice President and Chief Operating Officer of Bath Iron Works
July 1994 -- March 1996; Facility Manager of Electric Boat May 1993 -- June 1994;
Director of Operations of Electric Boat January 1989 -- May 1993

Gordon R. England -- Executive Vice President of the Combat Systems Group since March 1997; 59
President - Lockheed Fort Worth March 1993 -- March 1995; Executive Vice President
of the company and President - Aircraft Systems of the Fort Worth Division
July 1991 -- March 1993

David H. Fogg -- Staff Vice President and Treasurer since November 1994; Staff Vice President 41
and Assistant Treasurer May 1994 -- November 1994; Corporate Director of Finance and
Assistant Treasurer January 1994 -- May 1994; Corporate Director of Risk Management
November 1991 -- January 1994

Paul A. Hesse -- Vice President Communications and Secretary since February 1996; Vice President 55
Communications May 1991 -- February 1996

Raymond E. Kozen -- Vice President Planning and Analysis since March 1997; Staff Vice President 55
for Special Projects December 1987 -- March 1997

Kenneth J. Leenstra -- Vice President of the company and President of Armament Systems 59
since February 1997; President of Armament Systems - Lockheed Martin
January 1990 -- January 1997

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AGE AT
DECEMBER 31
NAME, POSITION AND OFFICE 1996
------------------------- ---------------

Michael J. Mancuso -- Senior Vice President and Chief Financial Officer 54
since March 1997; Vice President and Chief Financial Officer November 1994 --
March 1997; Vice President and Controller May 1994 -- November 1994; Division
Vice President and Chief Financial Officer of Land Systems September 1993 -- May 1994;
Vice President and Controller - Commercial Engine Business, Pratt & Whitney,
United Technologies Corporation (UTC) July 1992 -- September 1993; Vice President -
Finance and Administration, Hamilton Standard, UTC August 1989 -- July 1992

Daniel P. Schmutte -- Vice President of the company and President of Defense Systems 46
since February 1997; Vice President Operations August 1995 - February 1997;
Staff Vice President and Assistant to the President/Chief Executive Officer
June 1993 -- August 1995; Assistant to the President December 1990 -- June 1993

John W. Schwartz -- Staff Vice President and Controller since November 1994; Corporate Director 40
of Accounting July 1992 -- November 1994; Vice President- Corporate Accounting of MNC
Financial, Inc. February 1988 -- June 1992

Henry J. Sechler -- Vice President International Business Development since August 1991 64

James E. Turner, Jr. -- Executive Vice President of the Marine Group since October 1995; 62
Executive Vice President of the company and President of Electric Boat April 1993 --
October 1995; Executive Vice President of the Marine, Land Systems and Services Group
February 1991 -- April 1993

Arthur J. Veitch -- Vice President of the company and President of Land Systems since 50
February 1997; Vice President of the company and Senior Operating Officer of
Land Systems August 1995 -- February 1997; Division Vice President and General Manager
of the Convair Division August 1992 -- August 1995; Division Vice President and Program
Director - Aircraft Programs of the Convair Division May 1991 -- August 1992

John K. Welch -- Vice President of the company and President of Electric Boat since 46
October 1995; Division Vice President Programs and Planning of Electric Boat
April 1994 -- October 1995; Division Vice President Program Management and
Development of Electric Boat June 1989 -- April 1994

W. Peter Wylie -- Vice President Human Resources and Administration since August 1995; 57
Group Vice President - Hughes Missile Systems Company August 1992 -- January 1995;
Division Vice President Human Resources of the company's Missiles and Electronics Group
May 1991 -- August 1992

Michael W. Wynne -- Senior Vice President International, Planning and Business Development 52
since March 1997; Vice President and General Manager of Lockheed Martin, Martin
Marietta Astronautics Division May 1994 -- February 1997; Vice President of the
company and President of the Space Systems Division August 1992 -- May 1994;
Corporate Vice President and General Manager of the Space Systems Division March 1991
-- August 1992

All executive officers of the company are elected annually. There are no family
relationships, as defined, among any of the above executive officers. No
executive officer of the company was selected pursuant to any arrangement or
understanding between the officer and any other person.

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PART II

ITEM 5. MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED
SHAREHOLDER MATTERS

The company's common stock is listed on the New York Stock Exchange,
Chicago Stock Exchange and Pacific Stock Exchange.

The high and low market price of the company's common stock and the
cash dividends declared for each quarterly period during the two most recent
fiscal years are included in Note R to the Consolidated Financial Statements
appearing on page 37 of the 1996 Shareholder Report, included in this Annual
Report on Form 10-K as Exhibit 13, and are incorporated herein by reference.

There were 22,129 common shareholders of record of the company's
common stock at December 31, 1996.

ITEM 6. SELECTED FINANCIAL DATA

The information appearing on page 39 of the 1996 Shareholder Report,
included in this Annual Report on Form 10-K as Exhibit 13, is incorporated
herein by reference in response to this item.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS

The information appearing on pages 18 through 22 of the 1996
Shareholder Report, included in this Annual Report on Form 10-K as Exhibit 13,
is incorporated herein by reference in response to this item.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information appearing on pages 23 through 39 of the 1996
Shareholder Report, included in this Annual Report on Form 10-K as Exhibit 13,
is incorporated herein by reference in response to this item.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

None.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The information required to be set forth herein, except for a list of
the executive officers other than directors that is provided in Part I of this
report, is included under the caption "Election of Directors" in the company's
definitive Proxy Statement which is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION

The information required to be set forth herein is included under the
captions "Board of Directors and Board Committees" and "Executive Compensation"
in the company's definitive Proxy Statement which is incorporated herein by
reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information required to be set forth herein is included under the
captions "Election of Directors" and "Principal Shareholders" in the company's
definitive Proxy Statement which is incorporated herein by reference.

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12

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information required to be set forth herein is included under the
captions "Employment Agreements and Other Arrangements" and "Transactions
Involving Directors and Others" in the company's definitive Proxy Statement
which is incorporated herein by reference.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a) 1. Financial Statements

The Report of Independent Public Accountants and Consolidated
Financial Statements appearing in the 1996 Shareholder Report on the pages
listed in the following index are included in this Annual Report on Form 10-K
as Exhibit 13, and are incorporated herein by reference.

Page of
1996
Shareholder
Report
------------

Report of Independent Public Accountants 38

Consolidated Financial Statements:

Consolidated Statement of Earnings 23

Consolidated Balance Sheet 24

Consolidated Statement of Cash Flows 25

Consolidated Statement of Shareholders' Equity 26

Notes to Consolidated Financial Statements (A to R) 27-37

2. Financial Statement Schedules

No schedules are submitted because they are either not applicable or
not required, or because the required information is included in the financial
statements or the notes thereto.

3. Exhibits--See Index on pages 12 and 13 of this Annual Report
on Form 10-K.

(b) Reports on Form 8-K

There were no reports on Form 8-K filed during the fourth quarter of
1996.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.

GENERAL DYNAMICS CORPORATION

By: /s/ John W. Schwartz
--------------------
John W. Schwartz
Staff Vice President and Controller
March 21, 1997

Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below on March 21, 1997, by the following persons
on behalf of the Registrant and in the capacities indicated, including a
majority of the directors.

/s/James R. Mellor Chairman, Chief Executive Officer and Director
- ------------------ (Principal Executive Officer)
James R. Mellor

/s/ Nicholas D. Chabraja Vice Chairman and Director
- ------------------------
Nicholas D. Chabraja

/s/ Michael J. Mancuso Senior Vice President and Chief Financial Officer
- ---------------------- (Principal Financial Officer)
Michael J. Mancuso

/s/ John W. Schwartz Staff Vice President and Controller
- -------------------- (Principal Accounting Officer)
John W. Schwartz

* Director
- -----------------------
Frank C. Carlucci

* Director
- -----------------------
James S. Crown

* Director
- -----------------------
Lester Crown

* Director
- -----------------------
Charles H. Goodman

* Director
- -----------------------
Gordon R. Sullivan

* Director
- -----------------------
Carlisle A. H. Trost

*By Paul A. Hesse pursuant to Power of Attorney executed by the directors
listed above, which Power of Attorney has been filed with the Securities and
Exchange Commission.

/s/ Paul A. Hesse
-----------------
Paul A. Hesse
Secretary

11
14
INDEX TO EXHIBITS

Note Exhibit
Number Number Description
------ ------ -----------

(5) 3-1A --Restated Certificate of Incorporation, effective May 21, 1991
3-2C --Bylaws as amended effective August 7, 1996
4 --Letter re agreement to furnish copy of indenture
(1) 10-1A --Amendment of Mining Leases between American National Bank and Trust
of Chicago, Trustee, and La Salle National Bank, Trustee, to Freeman Coal Mining
Corporation, dated January 1, 1960
(1) 10-1B --Amendatory Agreement between Freeman United Coal Mining Company and American
National Bank and Trust Company, as Trustee, and La Salle National Bank, as Trustee,
dated January 1, 1975
(3) 10-6A --General Dynamics Corporation Incentive Compensation Plan adopted February 3, 1988,
approved by the shareholders on May 4, 1988
(4) 10-6B --General Dynamics Corporation Incentive Compensation Plan (as amended),
approved by shareholders on May 1, 1991
(2) 10-7D --Facilities Contract DAAE07-83-E-A007 dated January 29, 1983, between
General Dynamics Land Systems, Inc. and the United States relating to
government-owned equipment at the Scranton Defense Plant, Eynon, Pennsylvania
(4) 10-7E --Facilities Contract DAAE07-90-E-A001 dated June 24, 1990, between General Dynamics
Land Systems, Inc. and the United States relating to government-owned facilities and
equipment at the Lima Army Tank Plant, Lima, Ohio
(7) 10-8B --General Dynamics Corporation Retirement Plan for Directors adopted March 6, 1986, as
amended May 5, 1993
10-14A --Lease Agreement dated December 20, 1996, between Electric Boat Corporation and the
Rhode Island Economic Development Corporation
(6) 10-18 --Employment Agreement between the company and James R. Mellor dated as of
March 17, 1993
(9) 10-18A --Amendment to employment agreement between the company and James R. Mellor dated as of
October 3, 1995
10-18B --Amendment to employment agreement between the company and James R. Mellor dated as of
November 5, 1996
(6) 10-22 --Form of Agreement entered into in 1993 between the company and Corporate Officers who
were being retained in employment with the company
(8) 10-24 --Asset Purchase Agreement, dated August 17, 1995, between the company and Bath Iron Works
Corporation
(9) 10-25 --Lease Agreement dated January 14, 1982, between Bath Iron Works Corporation and the City of
Portland, Maine, relating to pier facilities in the Portland, Maine harbor
(9) 10-26 --Lease Agreement dated January 14, 1982, between Bath Iron Works Corporation and the State of
Maine, relating to a dry dock facility in the Portland, Maine harbor
(9) 10-27 --Form of Employment Agreement pertaining to change of control entered into between the
company and key executives
(10) 10-28 --Asset Purchase and Sale Agreement, dated November 6, 1996, as amended December 20, 1996,
between the company and Lockheed Martin Corporation
10-29 --Employment agreement between the company and Nicholas D. Chabraja dated
November 12, 1996
10-30 --General Dynamics Corporation Incentive Compensation Plan adopted by the board of directors
as of February 5, 1997

12
15
INDEX TO EXHIBITS

Note Exhibit
Number Number Description
- ------ ------ -----------

11 --Statement re computation of per share earnings
13 --1996 Shareholder Report (pages 18 through 39)
21 --Subsidiaries
23 --Consent of Independent Public Accountants
24 --Power of Attorney of the Board of Directors
27 --Financial Data Schedule

NOTES

(1) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1980, and filed with the Commission March 31,
1981, and incorporated herein by reference.

(2) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1982, and filed with the Commission March 30,
1983, and incorporated herein by reference.

(3) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1987, and filed with the Commission March 17,
1988, and incorporated herein by reference.

(4) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1990, and filed with the Commission March 29,
1991, and incorporated herein by reference.

(5) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1991, and filed with the Commission March 26,
1992, and incorporated herein by reference.

(6) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1992, and filed with the Commission March 30,
1993, and incorporated herein by reference.

(7) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1994, and filed with the Commission March 9,
1995, and incorporated herein by reference.

(8) Filed as an exhibit to the company's current report on Form 8-K filed
with the Commission September 28, 1995, and incorporated herein by
reference.

(9) Filed as an exhibit to the company's annual report on Form 10-K for the
year ending December 31, 1995, and filed with the Commission March 21,
1996, and incorporated herein by reference.

(10) Filed as an exhibit to the company's current report on Form 8-K filed
with the Commission January 15, 1997, and incorporated herein by
reference.