New Maryland plant and Navy contract

Anduril said on Tuesday that it will invest in a new production site called Arsenal-2 in the U.S. state of Maryland and manufacture submarine parts for the U.S. Navy. The California-based company said it will spend $3.7 billion on the facility and has also secured a $2.9 billion contract from the Navy.

The project was scheduled to be announced by U.S. President Donald Trump on Tuesday afternoon in Baltimore, Maryland. The initiative stands out as one of Washington's latest steps aimed at boosting maritime defense capabilities.

  • The new investment will be centered on the Arsenal-2 facility in Maryland.
  • The plant will produce critical components for Virginia-class submarines.
  • The company expects 3,100 direct jobs and more than 11,000 indirect jobs from the project.

Production pressure continues in the Virginia-class submarine program

The Maryland facility is planned to produce torpedo tubes and larger hull sections for modernized Virginia-class fast-attack submarines. The U.S. Navy is upgrading the submarines so each can carry up to 40 Tomahawk missiles. Although the vessels are nuclear-powered, they are not considered part of the U.S. strategic nuclear deterrent.

The Navy currently has 26 Virginia-class submarines, and two new boats are expected to be delivered in 2027. However, according to reports released by Defense Department and Navy officials, U.S. shipyards are struggling to meet the Pentagon's goal of building two new submarines a year because of supply-chain disruptions and labor shortages. Official figures show the delivery pace has remained at just 1.1 to 1.2 submarines a year.

Part of the Pentagon's broader war-tech push

The investment is seen as part of the Pentagon's broader program to speed up shipbuilding and weapons production. The U.S. administration argues that war with Iran and other regional conflicts threatening global oil shipping have once again underscored the importance of naval power.

Anduril, founded in 2017 by Palmer Luckey, is known for military autonomous systems, unmanned vehicles and software. In recent years, the company has also expanded into maritime and underwater systems. Luckey's role in leading the Pentagon's newly announced Project Meridian initiative alongside tech billionaire Elon Musk has also drawn attention. Defense Secretary Pete Hegseth said last week in Virginia that the 120-day effort, announced in his speech, aims to define future needs in autonomous, AI-enabled and sea-focused warfare technologies.