Anduril Wins Up to $2.9 Billion Navy Award, Plans $3.7 Billion Submarine-Parts Yard
An outcome-paid Navy contract moves a drone and software company into the Virginia-class supply chain, but the Maryland yard does not open until 2030.
An outcome-paid Navy contract moves a drone and software company into the Virginia-class supply chain, but the Maryland yard does not open until 2030.
The Navy awarded Anduril up to $2.9 billion on Oct. 6 for Virginia-class submarine components, with payments tied to demonstrated production outcomes, Anduril announced. The company also committed $3.7 billion in private capital to Arsenal-2, a new yard at Tradepoint Atlantic on Sparrows Point in Baltimore County, Maryland.
Frequently Asked Questions
What did the Navy award Anduril?
A contract worth up to $2.9 billion for Virginia-class submarine components, with payments tied to demonstrated production outcomes, Anduril said on Oct. 6, 2026. Anduril is adding $3.7 billion of private capital, for a combined $6.6 billion.
What is Arsenal-2?
A planned submarine-component yard at Tradepoint Atlantic on Sparrows Point in Baltimore County, Maryland: more than 2 million square feet on 187 acres with a 1,200-foot graving dock, run on Anduril's ArsenalOS software, per the company. Initial operations are expected in 2030.
What will it build?
Components and large assemblies for the Virginia-class, delivered to General Dynamics Electric Boat and HII's Newport News Shipbuilding for final assembly, per Anduril. Breaking Defense wrote that production starts with torpedo tubes before moving to full sections such as the bow.
Why does the Navy need more capacity?
Shipbuilders were delivering about one Virginia-class boat a year as of June 2025 against a goal of two, the Government Accountability Office found in July, citing late materials and a shortage of experienced workers. A senior administration official estimated the yard could add about 9 million labor hours a year, roughly a 15% increase.
What happens before 2030?
Anduril is standing up a 160,000-square-foot plant in Orange County, California, to make torpedo tubes and test assets and pursue SUBSAFE production qualification, which the company calls a two-year head start. About $500 million in Maryland state and county subsidies still need legislative approval, The Baltimore Banner reported.
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Marcus Schuler
Marcus Schuler edits BattlePolicy, a daily defense-technology brief connecting the companies and capabilities behind modern war to the contest among Europe, the US, Russia, and China.