Anduril Industries and the White House Tuesday announced plans for a new 2 million square foot shipbuilding facility in Maryland that will focus on producing Virginia-class attack submarine (SSN) parts.
The new facility, built with a combined $6.6 billion in private capital investment and federal contracting, will be called Arsenal-2 as a nod to Anduril’s first large manufacturing campus, Arsenal-1 in Pickaway County, Ohio. Arsenal-2 will be in the Sparrows Point complex at the Tradepoint Atlantic site in Baltimore County, Md.
Anduril said it expects the project to ultimately 3,100 direct jobs and support another 11,000 indirect jobs and drive $2 billion in annual economic output, including an estimated $312 million in wages annually.
The company said permitting and site preparation will start immediately and construction will start as soon as they can, pending necessary approvals. It said initial operations at Arsenal-2 are expected to come online in 2030, with production “scaling progressively thereafter as Anduril builds the workforce, supplier base, infrastructure, and manufacturing throughput required for submarine production.”
Anduril said the new facility is backed by a $3.7 billion private capital investment from the company while announcing the Navy also awarded a contract of up to $2.9 billion “with payments tied directly to demonstrated production outcomes.”
“This contract structure ensures that Anduril, not the taxpayer, takes on the majority of the execution risk, aligning incentives to ensure on-time, high-quality submarine production. Altogether, this equates to a $6.6 billion investment in America’s submarine industrial base,” the company statement said.
Senior administration officials this morning told reporters that the administration is not planning on moving budget money around for this and it will be part of the normal budgeting process. They said this is a multi-year budgeting process, with them considering funds in fiscal year 2027, but mostly looking at funding in fiscal 2028 and beyond while appreciating that Anduril is making a commitment up front and the administration is eager to back it up.
An industry official said conversations on this kind of shipyard started in late 2024 “but kicked into high gear” and changed context when President Trump issued his 2025 executive order pushing to rebuild American shipbuilding. The official said the Navy and administration recognized the need to produce more industrial capacity with this kind of initiative with its “grand scope.”
The White House and Anduril specifically said Arsenal-2 is focused on helping SSN builders General Dynamics Electric Boat and Huntington Ingalls Industries’ (HII) Newport News Shipbuilding meet domestic fleet requirements as well as help address AUKUS commitments that require additional production growth, with new suppliers, infrastructure, workforce and production capacity.
“Arsenal-2 is intended to contribute to that expansion,” the company said.
Anduril said this means it plans for Arsenal-2 to work its way up to building “complex components and large scale assemblies of the Virginia-class submarine and deliver them to Electric Boat and Newport News Shipbuilding for final assembly.“
Chris Brose, president and Chief Strategy Officer at Anduril, told reporters Tuesday that while this kind of shipyard parts work is done by skilled workers, Anduril hopes to break that work up into a larger number of simpler tasks “that a larger workforce can contribute to much faster, and really trying to get production capacity up.”
The company argued the Arsenal-2 site is in a good position to generate a new generation of heavy industry, with existing road, rail and maritime infrastructure connecting the site to suppliers. It harkened back to the region’s 20th century shipbuilding history in World War II, when Baltimore’s shipyards built the first Liberty Ship and Anduril said Sparrows Point was once called the patriarch of U.S. tanker builders.
“Arsenal-2 will return shipbuilding to a site that once helped define American naval power,” the company said.
The company also described its plans for Arsenal-2 as a 2 million square foot facility built around software-defined production and advanced manufacturing on a 187-acre site focused on high-volume, high-precision production of submarine capabilities.
It said this means the shipyard layout will be optimized for production compared to current conventional older yards, reducing the distances among fabrication, assembly, testing, and integration areas to eliminate staging bottlenecks.
Plans for Arsenal-2 include a functional 1,200-foot graving dock with multimodal road and rail access that supports large-scale component movement, high-bay assembly halls, adjacent fabrication areas, and reconfigurable production lines will allow the yard to “shift rapidly as Navy requirements evolve.”
While the Navy and Anduril start planning Arsenal-2, the company said it is already starting to stand up manufacturing capabilities to be used there at its new 160,000-square-foot facility in Orange County, Calif.
Until Arsenal-2 is ready, Anduril plans to start manufacturing “critical Virginia-class submarine components” at the facility it called purpose-built to support key submarine construction processes and SUBSAFE-qualified production qualification efforts.
“The Orange County facility gives Anduril a two-year operational head start to develop and validate manufacturing methods, production workflows, and quality systems before Arsenal-2 comes online. It will support prototyping and production of Virginia-class test assets and critical maritime components, including torpedo tubes, while allowing Anduril to recruit and train the early workforce on the systems and standards that will ultimately scale at Arsenal-2,” a company statement said.
Brose told reporters their California facility is starting to work on the “relatively simpler, kind of more straightforward components” of submarines that are current critical needs, like torpedo tubes.
They are starting on torpedo tubes and similar items that the “industrial base desperately needs to produce more of, and our goal is to help produce more of those types of systems. And then over time, as the yard comes online in Baltimore, scale up to larger modules, larger ship sections, and for us, this is being done in partnership with our traditional ship builders, who are phenomenal partners, phenomenal builders for these systems. They just need help in terms of capacity,” Brose said.
An industry official added the torpedo tube level of equipment “are complex and difficult to produce systems but they’re also…part of the system that we think we can get started on.”
The official noted the California facility is already starting to prototype and produce torpedo tubes based on information provided by Electric Boat and is working with the Navy to certify its systems and processes.
“We’re also trying to work very closely with the Navy. Admiral [Rob] Goucher and the Navy have been phenomenal partners in really looking at how we certify the systems that we will be building, and really looking as an opportunity to modernize the certification process. Not in any way reducing the bar for these safety critical systems, but really thinking about how we use new technologies, new processes, approaches to deliver these outcomes at the level that is required, but at less cost, faster pace, etc.”
Vice Adm. Gaucher is dual-hatted as both the Direct Reporting Portfolio Manager (DRPM) Submarines and Program Acquisition Executive (PAE) Undersea Warfare.
The industry official said beyond the initial work, “we’re going to have to earn our way into that goal to move from basic components of the system up to sort of more complex modules. It’s a very aspirational goal, in the future, to be able to produce full ship sections.”
However, the official clarified that Anduril’s goal is not to produce an entire submarine, just to be a critical and hopefully eventually growing part of the supply chain for shipbuilders.
Once Arsenal-2 is online, the company plans for the Orange County facility to continue supporting “broader maritime manufacturing efforts across Anduril’s industrial network.”
Anduril said this mimics how it has ramped up work at Arsenal-1 in Ohio by building up a workforce, processes and production system before full-scale operations.
Exchange Monitor affiliate Defense Daily first published a version of this story.
