Anduril Industries is planning a $3.7 billion investment in a new submarine-component manufacturing complex at Tradepoint Atlantic, the 3,300-acre logistics and industrial development at the Port of Baltimore.
The project, known as Arsenal-2, is expected to bring 3,100 permanent jobs to Sparrows Point and revive shipbuilding activity on the former Bethlehem Steel property. Initial operations at the planned 2 million-square-foot facility are scheduled to begin in 2030.
The plant will produce components for the U.S. Navy’s Virginia-class nuclear-powered attack submarines. Those components will be transported to Huntington Ingalls (NYSE: HII) in Newport, Virginia, and General Dynamics’ (NYSE: GD) Electric Boat operation in Groton, Connecticut, where the submarines will be assembled.
Anduril plans to begin production with smaller components, including torpedo tubes, before eventually moving into larger submarine structures such as bows and sterns.
According to an Anduril announcement, the U.S. Navy has awarded the company a $2.9 billion contract tied to the project. President Donald Trump was scheduled to visit Tradepoint Atlantic on Oct. 6 to promote the development.
Major economic impact for Maryland
Maryland officials have described the investment as the largest single private investment in the state and its biggest job-creation project in more than a decade.
The project is expected to support more than 14,000 jobs overall, including the permanent positions at the Anduril facility, according to the Maryland Department of Commerce. Anduril estimates the operation will generate more than $2 billion in annual economic output and approximately $312 million in annual wages.
“With this facility, thousands of Marylanders will have new pathways to work, wages and wealth through advanced training and high-skilled maritime manufacturing jobs,” Gov. Wes Moore said in the state announcement.
The development, however, comes amid political controversy. The Navy contract was awarded only days after Anduril co-founder Palmer Luckey was appointed to a Pentagon weapons advisory group alongside Elon Musk and former Republican Congressman Newt Gingrich.
The timing also falls weeks before the midterm elections, in which incumbent Democratic Gov. Wes Moore is on the ballot, along with eight seats in the House of Representatives.
Shipbuilding returns to Sparrows Point
Arsenal-2 will be built in the general area of the former Bethlehem Steel shipyard, bringing maritime manufacturing back to a site once closely associated with shipbuilding.
Tradepoint Atlantic acquired the property in 2014 and has since transformed it into a multimodal logistics hub combining warehouses, distribution facilities and marine operations.
The site is already attracting major maritime investment. Mediterranean Shipping Co., the world’s largest container line, broke ground earlier this year on a new $1.2 billion container terminal at Tradepoint Atlantic.
Public incentives still need approval
Maryland and Baltimore County have agreed to match as much as 13% of Anduril’s expected private investment through existing incentive programs and new appropriations.
Some elements of the proposed public support still require approval from the Maryland General Assembly and the Baltimore County Council.
Baltimore County’s proposed package includes a personal property tax incentive valued at up to $210 million over 30 years, according to WYPR.
The state’s package also includes capital funding for a workforce-training center. Maryland additionally plans to seek a federal Maritime Prosperity Zone designation for the area.
Port, rail and highway connections key to site selection
Tradepoint Atlantic’s combination of deepwater port facilities, rail and highway infrastructure and access to a large regional labor pool played an important role in attracting Anduril’s investment, according to officials.
The company also pointed to the site’s East Coast location and its proximity to other submarine contractors. Anduril considered potential locations in other parts of the country before selecting Maryland.
Tradepoint Atlantic forms part of the Port of Baltimore and provides waterfront access, commodity storage and connections to both CSX (NASDAQ: CSX) and Norfolk Southern (NYSE: NSC) through its marine terminal and private railroad.
Anduril has signed a long-term lease for the project at Tradepoint Atlantic, although the company has not disclosed the length of the agreement.
The manufacturing operation is expected to expand during the years following its planned 2030 opening, potentially increasing the scale of submarine-component production at Sparrows Point.
