Anduril has secured a contract worth up to $2.9 billion with the U.S. Navy to manufacture components for the Virginia-class submarine program, betting the contract's performance-based structure—which ties payments directly to production outcomes and assigns execution risk to the contractor—can be managed profitably at scale.
The startup is investing $3.7 billion to build a 2 million-square-foot shipyard at Sparrows Point outside Baltimore, slated to begin operations in 2030 and expected to create roughly 3,100 jobs. Specialized components including torpedo tubes will be manufactured at a separate 160,000-square-foot facility in Orange County, California.
Anduril President and Chief Strategy Officer Chris Brose said the facility will "become a growing part of the supply chain" for Virginia-class lead builders General Dynamics Electric Boat and Huntington Ingalls Industries, and presents "an opportunity to really reimagine how a shipyard is built and how this work is done."
The contract award follows the appointment of Anduril co-founder Palmer Luckey to Project Meridian, a Department of Defense task force charged with identifying capabilities for future conflicts. The group also includes former House Speaker Newt Gingrich and SpaceX CEO Elon Musk.
Defense technology companies and their leadership have gained influence in Washington as President Donald Trump prioritizes military shipbuilding expansion. Venture capital investors with defense exposure have also moved into Pentagon policy roles: Marc Andreessen, whose firm Andreessen Horowitz invests in defense tech, joined the Pentagon's defense policy board this summer, alongside Thiel Capital's Blake Masters.
Anduril, best known for autonomous drones, is pivoting into conventional shipbuilding as defense contractors face sustained pressure to increase submarine production. General Dynamics received a $76.6 billion Navy award this summer for submarine construction, underscoring the scale of capital flowing to the sector.
