“The ultimate proof of our commitment to ensuring the shipyard's enduring success: American taxpayers will receive a 40 percent stake in the new shipyard. We get 40 percent,” President Donald Trump said Tuesday, announcing a novel public-private arrangement for a submarine components facility outside Baltimore.
Arsenal-2: site, scale and schedule
Anduril plans to build the new shipyard, called Arsenal-2, on nearly 200 acres just outside Baltimore — a footprint the company likened to roughly 40 football fields. The company said it intends to break ground by early 2027 with initial operations starting by 2030. Arsenal-2 will focus initially on heavy component manufacturing for Virginia-class submarines and later expand to rafted module assemblies and sections of hull.
Navy contract, financing and production targets
The effort is part of a $6.6 billion program funded by Anduril at $3.7 billion and the U.S. Navy through a $2.9 billion contract award, Anduril said. The contract tasks Anduril with building “critical components and large scale assemblies of the Virginia-class” to be delivered to General Dynamics Electric Boat in Connecticut and HII Newport News Shipbuilding in Virginia, the prime contractors on the Navy’s submarine programs.
Anduril said the Navy contract ties payments to “demonstrated production outcomes.” Once operational, the Baltimore plant is expected to increase overall Navy submarine production by 15 percent — quantified by the company as roughly 9 million additional production hours per year — and to feed more work into the Newport News and Electric Boat yards.
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Get a security leadArsenalOS and software-driven shipbuilding
Anduril is designing Arsenal-2 around a digital backbone. Chris Brose, Anduril’s president and chief strategy officer, told reporters the yard will be “underpinned by Anduril’s ArsenalOS industrial software platform.” He said the software will govern factory layout, work flow, automation and digital traceability for safety-critical tasks like precision welding: “keeping digital records of things like precision welding, so that you have traceability back to all the work that was done and an ability to understand, in very precise detail, for the purposes of certification and other types of kind of safety critical measures, what was done at what point all along the way.”
Brose also described the software’s role in accelerating workforce readiness: enabling less experienced shipbuilders to contribute more quickly through “digital designs, technical augmentation” and reduced training burdens.
Pentagon ties and leadership present at the announcement
The move deepens Anduril’s relationship with the Defense Department. Defense Secretary Pete Hegseth named Anduril founder Palmer Luckey to an advising committee for Project Meridian, a Pentagon effort to analyze future warfare needs, the company said. Vice Adm. Robert Gaucher, who oversees Navy submarine construction, spoke at the event and framed the plant as a response to eroded industrial capacity: “At the same time, we must reckon with the fact that we have lost industrial capacity. Today, we start to rebuild it.”
The announcement event at Tradepoint Atlantic near Baltimore included about 100 sailors, 200 midshipmen bused from the U.S. Naval Academy, Acting Navy Secretary Hung Cao and Secretary Hegseth. The USS Billings and sailors from a Freedom-class littoral combat ship served as visible backdrops to the remarks.
How the Navy, prime shipyards, and shipbuilders are affected
- Navy leadership: The Navy is pursuing distributed shipbuilding to increase throughput; its 2026 shipbuilding plan noted “Today, roughly 10 percent of shipbuilding work is performed at distributed sites. Our goal is 50 percent.” Arsenal-2 is presented as a step toward that distributed model and a supplier to prime yards.
- Prime shipyards (Electric Boat and Newport News): Both primes are named recipients of components and assemblies from Arsenal-2. The Baltimore location is positioned “geographically between these two prime shipyards and connected to them by a network of sea, rail, and road,” Vice Adm. Gaucher said, enabling the plant to “take on the heavy component manufacturing.”
- Shipbuilders and workforce: Anduril says digital systems and reconfigurable production lines will automate tasks where possible and provide traceability to speed certification and accelerate training for new or inexperienced workers.
Anduril’s entry into traditional shipbuilding — funded in large part by the company itself and tied contractually to production outcomes — raises tangible deliverables and a tight timeline: ground by early 2027, initial operations by 2030, and a stated 15 percent boost in submarine production hours when up and running. A notable public element of the announcement was President Trump’s claim of a roughly 40 percent government stake in the new shipyard’s operating subsidiary — a detail he stated without additional specifics. How that stake will be structured, and how the new yard will integrate with existing prime yards’ certification and supply chains, are concrete next steps implied by the facts presented at the event.
