Anduril Industries plans to invest $3.7 billion in a new shipyard in the state of Maryland to produce key components for Virginia-class submarines. This investment is supported by a $2.9 billion contract from the U.S. Navy, aimed at expanding the submarine industrial base to meet growing demands.
Details of Arsenal-2 Shipyard
The new facility, known as Arsenal-2, will be built at the Tradepoint Atlantic complex in the Sparrows Point area of Baltimore County and is expected to be operational by 2030. The facility, covering over 2 million square feet, will produce complex components and large assemblies for delivery to General Dynamics Electric Boat and HII’s Newport News Shipbuilding. These companies are responsible for the final construction and assembly of the submarines.
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This project represents a significant expansion by Anduril into the realm of traditional military shipbuilding. The company, known primarily for producing unmanned aircraft, weapons, and marine systems, is entering the supply chain of one of the Navy's largest and most complex shipbuilding programs with Arsenal-2.
Investment Goals and Impact
Anduril has emphasized that it does not intend to produce complete submarines. The company’s CEO, Christian Brose, stated, "Our goal is to be a critical part and hopefully, over time, a larger and growing part of the supply chain for the prime shipbuilders." According to information provided by Anduril, the Navy contract will tie payments to the demonstrated production outcomes.
This investment, along with the company’s private investment, represents up to $6.6 billion in planned expenditures to increase submarine production capacity. While Congress has generally funded two Virginia-class submarines per year, actual production has remained significantly below this level. A Congressional Research Service report indicates that production rates in recent years have been around 1.1 to 1.4 submarines per year, constrained by labor shortages and supply chain issues in the submarine industrial base.
Arsenal-2 is designed to alleviate some of these constraints and is expected to enable more submarine production work to be done in parallel outside of Electric Boat and Newport News. A senior official in the Trump administration indicated that this facility could ultimately add about 9 million hours of productive work per year, equivalent to an approximate 15% increase in capacity for the Virginia-class program.
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