(Corrects style in headline)
By Nathan Gomes and Shivansh Tiwary
Oct 6 (Reuters) – Defense tech firm Anduril said on Tuesday it will invest $3.7 billion to develop a new shipyard in Maryland to build critical components for the US Navy’s Virginia-class submarines, as Washington seeks to bolster its maritime defense capabilities.
Subsequently, the US Navy awarded Anduril a contract worth up to $2.9 billion to manufacture submarine components, with payments tied directly to production outcomes and the company assuming most of the execution risk, the defense startup said.
The investment and associated contract, together valued at up to $6.6 billion, come amid a broader push by the United States and its allies to expand arms production following Russia’s invasion of Ukraine and conflicts in the Middle East.
The new plant, dubbed Arsenal-2, will be situated in Baltimore County and is expected to be up and running by the end of the decade, creating 3,100 direct jobs and supporting over 11,000 indirect jobs.
Asked about the $2.9 billion government contract, Christian Brose, chief strategy officer at Anduril, said, “It’s really the government buying the results of what we’re able to produce from the facility that we’ve invested in.”
Anduril is already building out a facility in California to manufacture critical Virginia-class submarine components such as torpedo tubes, helping address urgent capacity shortfalls in the US industrial base, Brose said.
The company plans to expand into producing larger submarine modules and hull sections once its Baltimore shipyard becomes operational.
Virginia-class submarines, which can travel at over 25 knots, are the Navy’s latest generation of nuclear-powered attack submarines, designed for anti-submarine warfare, land-attack strikes and surveillance missions.
General Dynamics’ Electric Boat and Huntington Ingalls Industries jointly build the submarines.
Anduril, founded in 2017 by Palmer Luckey, is a defense firm that is best known for its autonomous systems, drones and software built for the US military and its allies.
The startup has, however, expanded beyond drones into maritime and undersea systems and command-and-control software designed to connect military sensors, weapons and other systems.
The new plant comes after Anduril’s a $1 billion Arsenal-1 facility in Ohio that began producing autonomous combat drones this year.
(Reporting by Nathan Gomes in Bengaluru; Editing by Devika Syamnath)
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