Anduril to invest $3.7bn in Maryland shipyard after securing $2.9bn US Navy submarine parts contract

Defence technology firm Anduril has said it will invest $3.7bn to develop a new shipyard in Maryland and build critical components for the United States Navy's Virginia-class submarines. The company also said it has secured a $2.9bn US Navy contract to manufacture submarine parts. The project, known as Arsenal-2, is part of a wider push to expand US naval production capacity.

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The new facility is planned for Baltimore, Maryland, and is expected to make torpedo tubes and larger hull components for upgraded Virginia-class fast attack submarines. Anduril said the plant will support the Navy's submarine production needs as Washington seeks to strengthen maritime defence capabilities. The company, which is based in California, said the investment would be directed at developing the shipyard and related manufacturing capacity.

Anduril is best known for autonomous systems, drones and software, but it has expanded into maritime and undersea systems in recent years. The firm said it specialises in uncrewed underwater vehicles and ocean vessels for the US military and its allies. Its co-founder, Palmer Luckey, is also heading a new Defence Department project with technology billionaire Elon Musk, under a newly disclosed initiative focused on the future of warfare.

That initiative, called Project Meridian, was announced as part of a 120-day study aimed at identifying technology needed for next-generation battlefield capabilities. Defence Secretary Pete Hegseth referred to the broader effort in a State of the Force address last week in Virginia. The Pentagon has been seeking to accelerate shipbuilding and weapons production, reflecting concern about the pace of industrial output and the demands of modern maritime conflict.

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The submarine work is significant because Virginia-class boats are a central part of the US Navy's fast attack fleet. Anduril said the upgraded submarines are being renovated to carry up to 40 Tomahawk missiles each. While nuclear-powered, the vessels are not part of the United States' strategic nuclear deterrent, but they remain important for conventional strike and undersea operations.

The announcement also comes against a backdrop of broader defence-industrial competition and pressure on naval supply chains. The Pentagon's push to expand shipbuilding has been linked to regional conflicts that have highlighted the importance of maritime power and the security of global sea routes. What remains unclear is the full timetable for the Maryland shipyard, how quickly production will scale, and how the contract will affect wider submarine manufacturing plans.

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