Why not? There are only three shipyards which currently build submarines. And remember that Jiangnan is relatively vulnerable, whereas Huludao and Wuchang are more protected. We see Wuchang expanding as well.
Yes, the rails are sized to handle SSN/SSBNs.
But there's no point building a smaller gauge railway, because it won't be compatible with the existing network
And UUVs (which are smaller) can presumably be moved via transporters, rather than need the rails.
Now, given that submarine technology is trending towards larger submarines as carriers for missiles or UUVs, that would mean only (3+2+1) such bays available for submarines at least as big as SSBNs. It depends on how fast UUVs develop.
It would be interesting to know how long it actually takes to build an SSN in China, from start to finish. My guess is less than 4 years.
6 SSNs per year won't achieve global dominance over the US. Even after 10 years, that's 60 additional SSNs. So China would have a somewhat larger SSN force than the US, but it wouldn't be a globally dominant because submarines are sea denial systems. For dominance, you need carriers which can launch aircraft that assert sea control over long distances.
Something the size of HSU-001 definitely does not need a dedicated submarine yard to build, and certainly not nuclear certified yard. Huludao will build non-nuclear subs long before they start building UUVs, and there's no evidence they're doing even that.
The USN currently has 53x SSN, 13x SSBN and 4x SSGN for total of 71, it building 1.5x Virgina a year trying to ramp up to 2 a year, has a total of 12x Columbia ordered that won't enter service until 2030s, all 4x SSGN are schedule for retirement by 2028 and almost all Los Angeles boats will be retired by 2035, which means in 10 years US will have, assuming they can ramp up Virgina and Columbia stays on schedule, ~40x Virginia SSN, ~14x Ohios and ~2x Columbia.
So even if we start at 6+6 for China today (it's almost certainly higher), and not counting the 4 new bays added at Huludao, not counting bays prior to 2016 expansion, not counting conventional subs or semi-nuclear subs, in 10 years we're looking at conservatively 72x vs 56x, and if that's not enough for dominance, then give it 15 years for China 100 vs 70.
Sure submarines alone isn't enough to ensure global dominance over USN, which is where China's massive surface fleet construction and global prompt strike systems comes in. Remember, SSN was the USN's last saving grace.