Palmer Luckey's Anduril and the US Navy are investing billions in a new shipyard to build parts for critical submarines

Palmer Luckey's Anduril and the US Navy are investing billions in a new shipyard to build parts for critical submarines Virginia-class submarine production has run into various problems with the supply chain and industrial base. US Navy photo by Mass Communication Specialist 2nd Class Nicholas A. Russell The US Navy and Anduril Industries are teaming up to build a new shipyard to produce critical parts for Virginia-class submarines.Both the defense company, co-founded by Palmer Luckey, and the Navy will invest billions of dollars to construct the facility in Maryland, with plans to launch initial operations in 2030. The shipyard is the latest step to address gaps in the Navy's submarine industrial base and supply chain, which have contributed to delays in the delivery of Virginia-class submarines and other vessels.On Tuesday, Anduril and the White House announced the new facility, named Arsenal-2, in Baltimore County, Maryland. It comes with a $6.6 billion investment, $3.7 billion of which is private capital. The remaining $2.9 billion will come from the Navy. Anduril expects the shipyard will create over 3,000 direct jobs and support more than 11,000 jobs."The facility will manufacture critical components for the Virginia-class submarine, adding significant new capacity to America's submarine industrial base in support of the Navy's effort to increase attack submarine production," Anduril said in a statement.The Virginia-class submarine is built by General Dynamics Electric Boat and Huntington Ingalls Industries' Newport News Shipbuilding. Anduril's Arsenal 2 facility will build "complex components and large scale assemblies" for the vessels, according to the company. A graphic rendering of the new facility. Photo courtesy of Anduril When the facility opens, it'll start by producing smaller parts like torpedo tubes before expanding into more complex designs like full sections of the vessel. Anduril said that adding another source for this work will help boost submarine construction."We need to grow the maritime industrial base, the submarine industrial base, so that we can produce more submarines. So the goal here for Anduril is to contribute to that. This is not about taking food off the plate of anybody," Chris Brose, Anduril's president and chief strategy officer, told reporters on Tuesday, according to a transcript. "This is about putting more food on the table and being able to meet the requirements that our country has to produce more submarines."The Navy has been navigating issues with the production of Virginia-class submarines for years now, with the program and other shipbuilding projects facing delays and cost overruns. US officials and experts have raised concerns over an atrophied industrial base and a shortage of skilled workers to build vessels.In July, a report from the US Government Accountability Office, a congressional watchdog, noted that late material deliveries and a limited skilled workforce have driven the trend of lower deliveries of Virginia-class submarines. The Navy and industry's priorities for fixing these issues have included investing in rebuilding the US shipbuilding industry, paying workers more, upgrading shipyards, and solidifying supply chains. Earlier this year, Adm. Daryl Caudle, chief of naval operations, told the House Appropriations Committee that he anticipates industry will start delivering two Virginia-class submarines a year by 2032. Read next Chris Panella is a defense reporter for Business Insider. He covers technological transformations in the US military with focuses on US military modernization, US Army transformation, and emerging technologies like artificial intelligence and drones. Globally, Panella reports on China's military and Taiwan. Panella has embedded with the Army in Alaska, interviewed special operators learning to fly drones, and flown with US Coast Guard helicopters practicing drug interdictions. If you have a tip related to these areas or broader defense coverage, Panella can be reached at cpanella@businessinsider.com or on Signal at cpanella.85. Defense