Anduril was awarded a contract valued at up to $2.9 billion by the U.S. Navy on Tuesday to expand submarine manufacturing capabilities. The deal comes just days after the defense technology firm’s CEO, Palmer Luckey, was appointed to a new Pentagon initiative focused on identifying capabilities for future conflicts.
The company also announced a $3.7 billion investment to develop a new shipyard at Sparrows Point, located outside Baltimore, Maryland. Expected to begin operations in 2030, the Arsenal-2 facility will span more than 2 million square feet and produce components for the Virginia-class submarine program. Additionally, specific parts, including torpedo tubes, will be manufactured at a 160,000-square-foot site in Orange County, California.
“This is about putting more food on the table and being able to meet the requirements that our country has to produce more submarines,” Anduril President and Chief Strategy Officer Chris Brose told reporters during a press briefing.
The contract highlights the increasing leverage of defense technology firms in the nation’s capital. Luckey was recently selected for Project Meridian, a Department of Defense effort to develop tools for future warfare, alongside former House Speaker Newt Gingrich and SpaceX CEO Elon Musk. Both SpaceX and Anduril already maintain active contracts with the U.S. government.
This growing influence aligns with President Donald Trump’s push to strengthen American military infrastructure, particularly in shipbuilding. In the summer, Marc Andreessen, whose venture capital firm Andreessen Horowitz invests heavily in defense tech companies like Anduril, was also named to the Pentagon’s defense policy board, joining Thiel Capital’s Blake Masters.
The Virginia-class submarines are currently constructed by General Dynamics Electric Boat and Huntington Ingalls Industries. This summer, General Dynamics secured a $76.6 billion Navy contract for submarine production. Anduril estimates that its new facility will generate $2 billion in annual economic output and create 3,100 jobs.
Torpedo tubes in California and other parts in Maryland? That supply chain logistics must be a nightmare to manage efficiently.
Nearly three billion for components, plus billions more in investment. I just want to know how we’re measuring the ROI here.
General Dynamics has dominated this space for decades. It’ll be interesting to see if Anduril can actually scale up quickly.
Wait, Luckey in a Pentagon task force AND landing this contract? The revolving door feels a bit tight, doesn’t it?
Thirty-one hundred good jobs for our area is huge news. Let’s hope they hit those 2030 timelines.