A new shipyard planned for Maryland will build major parts for Virginia-class nuclear-powered attack submarines, the class the United States is preparing to transfer to Australia under AUKUS.
US President Donald Trump announced the project, called Arsenal-2, on Tuesday 6 October, US time. The yard will be at Sparrows Point near Baltimore, and defence company Anduril will run the work there.
The exact site is Tradepoint Atlantic in Baltimore County, part of a complex that once held Bethlehem Steel’s steelmaking and shipbuilding operations and is now used for logistics and industry, gCaptain reported.
The money comes from two places: a US Navy contract worth up to $US2.9 billion and $US3.7 billion of Anduril’s own investment. That makes $US6.6 billion in total, according to the Guardian, gCaptain and Anduril. The yard is expected to begin operations in 2030.
Anduril and Maryland officials expect the project to create more than 3,100 direct jobs and support more than 11,000 others, gCaptain reported.
Parts, Not Whole Boats
Anduril will not build complete submarines. The yard will make components and large sections, including torpedo tubes, and deliver them to the two existing builders for final assembly, gCaptain reported. The Guardian also named torpedo tubes among the parts. Those two builders are General Dynamics Electric Boat and HII’s Newport News Shipbuilding, according to gCaptain and Naval News.
The yard is to include a 1,200-foot graving dock, both outlets reported. Anduril says the facility will cover more than 2 million square feet on a 187-acre site.
Some work will start sooner. Anduril plans to begin making components, including torpedo tubes, at a 160,000-square-foot facility in Orange County, California, gCaptain reported. Anduril says that gives it a two-year head start.
The company has not built crewed submarines before, the Guardian noted. Under this plan it will supply sections to the existing builders rather than take on that work itself.
Acting US Navy secretary Hung Cao described the arrangement as a “partnership between the navy and Anduril that breaks through bureaucratic red tape”, according to the Guardian.
The Politics Behind It
Anduril’s founder, Palmer Luckey, is a major Republican fundraiser, the Guardian reported. Trump called him “a friend of mine”.
Trump also said taxpayers would “receive a 40% stake”. The Guardian reported that it is unclear what he meant.
The AUKUS Question
For Australia, the issue is how fast the boats are built. Congress has generally funded two Virginia-class boats a year, gCaptain reported, but a Congressional Research Service report it cited put output at roughly 1.1 to 1.4 boats a year. The Navy wants to reach two a year and then about 2.33, to meet US fleet needs and its AUKUS commitments to Australia, according to gCaptain.
A senior administration official said the new facility could eventually add about 9 million production labour hours a year, roughly a 15% increase in Virginia-class capacity, according to gCaptain.
Arsenal-2 will not fix the current backlog, gCaptain reported. It is, however, due to open in the period when the US is preparing to transfer submarines to Australia under AUKUS.
Doubts over the submarine timeline have come up before. In June 2025, Buzzline reported on Trump’s review of AUKUS and what it meant for Australia’s submarine plans.
Arsenal-2 is meant to help lift that output. With operations not expected until 2030, its first sections will not reach the two existing builders before then.
Sources: The Guardian, “Trump announces $6.6bn defense shipyard owned by top Republican donor’s firm”, 6 October 2026 (https://www.theguardian.com/us-news/2026/oct/06/trump-shipyard-anduril-baltimore); gCaptain, “Anduril to Build Massive Maryland Shipyard for Virginia-Class Submarine Components”, 7 October 2026 (https://gcaptain.com/anduril-to-build-massive-maryland-shipyard-for-virginia-class-submarine-components/); Naval News, “Anduril, U.S. Navy Invest $6.6 Billion to Expand America’s Submarine Industrial Base”, 6 October 2026 (https://www.navalnews.com/naval-news/2026/10/anduril-u-s-navy-invest-6-6-billion-to-expand-americas-submarine-industrial-base/)
US Navy photo by Steven Myers / Wikimedia Commons / public domain
The Virginia-class attack submarine Missouri heads down the Thames River in Connecticut for sea trials in July 2010. A US Navy file photograph; the planned Maryland yard has not yet been built.
