Palmer Luckey's Anduril and the US Navy are investing billions in a new shipyard

The US Navy and Anduril Industries are teaming up to build a new shipyard to produce critical parts for Virginia-class submarines.

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.

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.

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.

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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.