The US Navy and Anduril Industries plan to invest $6.6bn in a new shipyard at Sparrows Point, Maryland, intended to produce submarine components, autonomous underwater vessels and other undersea systems.
US President Donald Trump and Secretary of War Pete Hegseth announced the project named Arsenal-2 on 6 October 2026 at the future site, which forms part of the Tradepoint Atlantic industrial complex.
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The US builds around 1.3 nuclear-powered attack submarines per year, far short of its two-boat annual target. In addition, further pressures are expected on the submarine supply chain as a result of the trilateral AUKUS agreement with the UK and Australia.
Occupying more than two million ft2 on a 187-acre site, the planned facility will be the largest US shipyard since World War II.
The company said the yard’s layout would bring fabrication, assembly, testing and systems integration activities closer together. It said this configuration is intended to reduce the movement and staging requirements associated with conventional shipyard production.
President Trump said: “Today, we’re officially launching the construction of the largest new shipyard in the United States. Since World War II, there’s been nothing like what we’re doing today.”
Anduril will build and operate the facility, investing $3.7bn alongside a $2.9bn contribution from the US Navy.
The company said the site would be designed to manufacture components for Virginia-class submarines, including torpedo tubes, as well as autonomous underwater vessels.
Permitting and site-preparation activity is due to begin immediately, with construction to start once approvals have been obtained. Initial operations are expected in 2030, after which manufacturing will be increased as Anduril develops its workforce, supplier base and production capacity.
According to the company, the facility is expected to include a 1,200ft graving dock, high-bay assembly halls, adjacent fabrication areas and reconfigurable production lines.
Road, rail and maritime infrastructure at Sparrows Point will provide connections to suppliers and the US’s two existing primary submarine builders.
Arsenal-2 will use Anduril’s ArsenalOS industrial software platform as its digital production system. The company said the platform would connect fabrication workflows, outfitting, material handling, inspection processes and documentation within a single system.
Digital work instructions, embedded quality controls, sensors and automation are also planned for the site.
According to the company, these systems are intended to provide workers and production managers with visibility of manufacturing activity, while supporting skilled trades including welding, pipefitting, electrical work, shipfitting and inspection.
Hegseth said the project formed part of the administration’s “arsenal of freedom” initiative for the US defence industrial base.
“In order to make America great again, you need to make your Navy great again. You need to make shipbuilding great again, our manufacturing great again, our defence industrial base strong and robust again,” Hegseth said.
The project is forecast to create 3,100 direct jobs at the Maryland site and support more than 11,000 indirect jobs nationally.
The announcement estimated annual economic output at $2bn, including approximately $312m in annual wages.
Sparrows Point has previously hosted major industrial and maritime activity.
Anduril said the location’s existing infrastructure and proximity to maritime supply routes were factors in its selection for the planned facility.
Alongside the Maryland development, Anduril is establishing a 160,000ft2 manufacturing facility in Orange County, California.
The company said the site would produce Virginia-class test assets and submarine components, including torpedo tubes, while supporting the qualification work required for SUBSAFE production.
Anduril expects the California operation to begin work before Arsenal-2 is operational, giving it what it described as a two-year period to establish manufacturing methods, production workflows and quality systems.
The facility is also expected to be used to recruit and train an initial workforce for the Maryland site.
Once Arsenal-2 starts operating, the Orange County plant will continue to support Anduril’s maritime manufacturing activities, the company said. It compared the approach with its Arsenal-1 manufacturing operation in the Columbus, Ohio, region, where it has sought to establish production processes and workforce capacity before full-scale output.
Arsenal-2 will join a wider Anduril manufacturing network that includes Arsenal-1 in Ohio, a maritime factory at Quonset Point in Rhode Island, a Ghost Shark production site in Sydney, Australia, and a rocket-motor facility in McHenry, Mississippi.
Anduril co-founder and CEO Brian Schimpf said: “The US has rebuilt its industrial strength before. We must do so again. Arsenal-2 is Anduril’s commitment to that future — and to America’s ability to refit the fleet for the century ahead.”
