Defense contractor Anduril Industries announced plans on Tuesday, October 6, 2026, to invest $3.7 billion in a new shipyard at Sparrows Point in Baltimore County, Maryland. The 2 million-square-foot facility, named Arsenal-2, will manufacture parts for Virginia-class nuclear-powered attack submarines. The project is supported by a U.S. Navy contract worth up to $2.9 billion, with payments tied to specific production outcomes.
The investment follows an April 2025 executive order from the Trump administration aimed at rebuilding the U.S. maritime industrial base and a subsequent August 2025 memorandum to increase shipbuilding competition. According to a July 2026 report from the Government Accountability Office (GAO), the Virginia-class submarine program has faced labor shortages and material delivery delays. Anduril officials stated the new facility is intended to address these production bottlenecks.
The shipyard will be located on 187 acres at Tradepoint Atlantic, the former site of Bethlehem Steel. The facility will feature production lines, fabrication areas, and a 1,200-foot graving dock. Anduril plans to produce critical components such as torpedo tubes before expanding into larger submarine modules. These parts will be sent to General Dynamics Electric Boat and HII’s Newport News Shipbuilding for final assembly into complete submarines.
For Maryland residents, the project is projected to generate $2 billion in annual economic output for the state. Maryland Governor Wes Moore (D) stated the facility would provide new pathways to wages and wealth through high-skilled maritime manufacturing. The investment marks the largest private investment in Maryland in over a decade. The funding for the Navy's $2.9 billion portion of the project is expected to be managed through the regular federal budget process, according to administration officials.
Construction and site preparation are scheduled to begin immediately following the receipt of necessary permits and approvals. Initial operations at the Sparrows Point facility are expected to commence in 2030, with production levels increasing over time. Any new state or local appropriations for the incentive package will require final approval from the Maryland General Assembly and the Baltimore County Council. President Trump was scheduled to visit Baltimore County on Tuesday afternoon to formally announce the project alongside Governor Moore.