Anduril Industries

Defense Tech · Shipbuilding · Submarines

Expansion

Anduril launches $6.6B Arsenal-2 shipyard to build submarine parts

The contract shifts production risk off taxpayers and onto the contractor, a sharp break from the cost-plus model that dominates US shipbuilding.

• Anduril and the U.S. Navy are investing $6.6 billion to build Arsenal-2, a new shipyard in Baltimore County, Maryland, to manufacture components for Virginia-class submarines.
• Anduril, founded in 2017 by Palmer Luckey, is best known for autonomous drones and defense software and is now expanding into submarine manufacturing.
• The $6.6 billion splits into $3.7 billion from Anduril and up to $2.9 billion from a Navy contract tied directly to production outcomes, with Anduril assuming most of the execution risk.
• The 2-million-square-foot, 187-acre facility at Tradepoint Atlantic will start by producing torpedo tubes, with an aspirational long-term goal of building full submarine hull sections.
• Arsenal-2 is expected to create more than 3,100 direct jobs and support over 11,000 indirect jobs, with initial operations targeted for 2030.
• The U.S. government will hold an approximate 40% stake in the new Anduril subsidiary set up to operate the shipyard, though it takes no equity stake in Anduril itself.
• Virginia-class submarines are built jointly by General Dynamics Electric Boat and HII's Newport News Shipbuilding, which have struggled to hit the Navy's annual production targets.
• The deal marks Anduril's first entry into a legacy defense shipbuilding program, showing how venture-backed tech firms are moving into industrial-base work the Pentagon says can't keep pace with demand.