Of course it would.
CSS Hunley is a good example.
All the South did was repeat what the North had done with the Turtle during the revolution.
Which they didn't try a second time till years later but the CSA did. But the fact the south could produce a more modern version speaks for how far it was developed. As I said the north didn't mind a single bit building it's factories on the backs of slaves. When it saw an economical advantage it used it including pushing for abolition.
The north was not by any means the saints history would have them be either. Go look in a National Cemetery established in the Civil War era. Look at the stones. Look at the sections of the cemetery. Look for USCT on the markers. Look around for others in the area there won't be any except USCT. Why the designation of USCT? Hum. The war was over two things States Rights and economical domination.