Anduril and Navy Plan $6.6 Billion Arsenal-2 Shipyard at Sparrows Point

Anduril Industries and the U.S. Navy have announced a $6.6 billion plan to build Arsenal-2, a shipyard of more than 2 million square feet on a 187-acre site at Sparrows Point in Baltimore County, Maryland, to manufacture components for Virginia-class submarines. Permitting and site preparation are to begin immediately, and initial operations are targeted for 2030.

What Happened

President Donald Trump and Secretary of War Pete Hegseth announced the project on October 6 at the future site (Naval Technology). Anduril will build and operate the facility at Tradepoint Atlantic, the industrial complex on the former Bethlehem Steel property at Sparrows Point (ConstructConnect News, FOX45 News).

The $6.6 billion figure combines two commitments. Anduril plans to invest $3.7 billion of its own capital, and the Navy has awarded the company a contract worth up to $2.9 billion, with payments tied to production outcomes (Manufacturing Dive). An industry official told FOX45 that the federal money does not reimburse Anduril for building the yard: the company funds the capacity and the government pays for what is produced (FOX45 News).

The Project

• Size: more than 2 million square feet of floor space on 187 acres, which the company compares to roughly 40 football fields (ConstructConnect News). Naval Technology reports it would be the largest U.S. shipyard built since World War II (Naval Technology).
• Planned features: a 1,200-foot graving dock, high-bay assembly halls, adjacent fabrication areas and reconfigurable production lines, with fabrication, assembly, testing and systems integration located together to cut down on material movement and staging (Naval Technology).
• Logistics: road, rail and maritime connections at Sparrows Point are expected to handle oversized components. The waterfront allows finished pieces to move by water to General Dynamics Electric Boat in Connecticut and to Huntington Ingalls Industries' Newport News Shipbuilding in Virginia (FOX45 News).
• Product: Anduril will not build complete submarines. It plans to start with components such as torpedo tubes, then move to more complex modules and possibly full bow and stern sections, with final assembly remaining at the two existing builders (FOX45 News).
• Software: the yard will run on the company's ArsenalOS platform, which is meant to link fabrication, outfitting, material movement, inspection and documentation in one system (Manufacturing Dive).
• Jobs: Anduril projects about 3,100 direct jobs by 2034 and more than 11,000 indirect jobs nationwide (Manufacturing Dive, ConstructConnect News). Maryland officials project more than 14,000 direct and indirect jobs, more than $2 billion in annual economic output and about $312 million in yearly wages (FOX45 News).

Anduril chief executive Brian Schimpf framed the need in capacity terms: "The country requires substantially more places where submarine components can be built" (Manufacturing Dive). The United States currently builds about 1.3 nuclear-powered attack submarines a year against a stated target of two (Naval Technology).

Where Things Stand

The announcement sets a direction, not a construction schedule. According to the company, permitting and site preparation begin immediately, vertical construction follows required approvals, and first operations are targeted for 2030, with output rising as the workforce and supplier base mature (Naval Technology).

No general contractor, designer, phasing plan or permitting timetable has been announced (ConstructConnect News).

Public money is also not fully settled. Maryland and Baltimore County have agreed to match up to 13 percent of Anduril's anticipated private investment through existing incentive programs and new appropriations, and some of that still needs approval from the Maryland General Assembly and the Baltimore County Council. FOX45 calculates that 13 percent of $3.7 billion is about $481 million, but state officials have not confirmed that total or the split between state and county. A senior administration official said federal funding is expected through multiyear budgeting, mainly in fiscal 2028 and beyond (FOX45 News).

Work has already started elsewhere. Anduril is setting up a 160,000-square-foot plant in Orange County, California, to produce test assets and components including torpedo tubes, support the qualification work required for SUBSAFE production, and train the first Maryland workers. The company expects that plant to give it roughly a two-year head start (Naval Technology).

Implications for Owners, Developers, Contractors and Subs

• A very large heavy industrial package is coming to market without a named builder. ConstructConnect notes the project will likely require specialized manufacturing systems, heavy industrial utilities, quality-control infrastructure and secure operations, and that redeveloping the industrial site may bring both challenges and opportunities for construction firms (ConstructConnect News). Firms with marine, heavy civil, high-bay steel and process utility experience should watch for procurement announcements.
• Site work leads. With permitting and site preparation described as immediate, early packages are likely to involve environmental, geotechnical, demolition and marine work on a former steel mill property before any building trades mobilize. That sequencing is an inference from the stated timeline, not a published schedule.
• Mid-Atlantic labor will tighten. A project of this scale will compete for craft labor with other work in the Baltimore region, including the port projects we covered in Sparrows Point Container Terminal Breaks Ground. Owners planning 2027 to 2030 starts in the region should account for that in escalation and schedule assumptions.
• Production trades matter as much as construction trades. Anduril says it intends to hire people without college degrees or prior shipbuilding experience and to use software and automation to break work into tasks that are easier to learn, recruiting from aerospace, automotive manufacturing, high schools and vocational programs. Maryland plans capital support for a workforce training center at or near Tradepoint Atlantic (FOX45 News).
• Payment structure shifts risk to the manufacturer. Because Navy payments depend on demonstrated production, Anduril says it carries most of the execution risk (FOX45 News). Contractors should expect an owner focused on schedule certainty and on getting production space turned over early.

What to Watch

• Selection of a design team and construction manager, and how the work is packaged.
• Votes by the Maryland General Assembly and Baltimore County Council on the incentive match.
• Environmental and waterfront permits, including for the graving dock.
• Whether the Orange County plant qualifies its first components on the timeline the company has described.
• Maryland's request for a federal Maritime Prosperity Zone designation for the region (FOX45 News).

Bottom Line

Arsenal-2 is one of the largest industrial construction projects announced in the United States this year, and it is at the very beginning. The site, the size and the funding structure are public. The builder, the schedule and part of the public funding are not. For contractors and suppliers, the practical step now is to track procurement and permitting at Tradepoint Atlantic over the coming months.

Image credit: Anduril Industries. Image from the source announcement.

Sources

• Manufacturing Dive, "Anduril, US Navy to build $6.6B shipyard in Maryland": https://www.manufacturingdive.com/news/anduril-industries-u-s-navy-arsenal-2-shipyard-baltimore-county-maryland/832275/
• FOX45 News, "Multibillion-dollar investment to expand submarine production in Sparrows Point": https://foxbaltimore.com/news/local/president-donald-trump-governor-wes-moore-maryland-anduril-industries-virginia-class-submarines-tradepoint-atlantic-sparrows-point
• Naval Technology, "US Navy, Anduril plan $6.6bn Arsenal-2 shipyard in Maryland": https://www.naval-technology.com/news/arsenal-2-shipyard-us-navy/
• ConstructConnect News, "Maryland's $6.6B Arsenal-2 Shipyard to Expand Submarine Component Manufacturing": https://news.constructconnect.com/marylands-6.6b-arsenal-2-shipyard-to-expand-the-u.s.-submarine-industrial-base
• Anduril Industries, "Anduril, U.S. Navy Invest $6.6 Billion to Expand America's Submarine Industrial Base": https://www.anduril.com/news/anduril-u-s-navy-invest-usd6-6-billion-to-expand-america-s-submarine-industrial-base