Inside Trump’s plans to make U.S. shipbuilding industry great again

President Donald Trump has vowed to lead a revival in U.S. shipbuilding, but the success of this manufacturing renaissance in a sector key to national security will depend on expertise from abroad.

The administration’s goal of a shipbuilding boom is part of Trump’s “Make America Great” policy agenda. Trump signed a deal executive order We took action to support the shipbuilding industry in April, but many industry executives have warned that this will not be easy given the current state of the domestic industry and that foreign investment and cooperation is key. The Trump administration’s “Make American Shipyards Great Again” initiative aims to build liquefied natural gas tankers, polar icebreakers and Navy ships.

“The American shipbuilding industry has experienced two booms in the last 110 years,” Peter Sand, chief marine analyst at Xeneta, told CNBC. “The first explosion occurred during World War I and the second occurred during World War II,” he said.

Approximately China 232 times the shipbuilding capacity The United States dominates the global commercial shipbuilding industry. The United States currently has eight active shipyards. There are over 300 in China.

The Trump administration’s shipbuilding plan is an extension of an investigation into Chinese shipbuilding by the U.S. Trade Representative under the Biden and Trump administrations. USTR 301 research It found that the Chinese government strengthened its shipbuilding dominance by using significant subsidies and defining the industry as strategic. The investigation said the actions, policies and practices were “unreasonable and burdened or restricted U.S. commerce.”

The United States recently began charging fees for ships built in China that visit U.S. ports, prompting China to take retaliatory measures, but the two countries agreed to a one-year pause as part of a trade truce in November.

In 2008, China surpassed Japan in shipbuilding production. In 2010, China surpassed South Korea to become the world’s largest shipbuilder in terms of both production capacity and new orders. Since then, China’s lead has continued to grow. His global market share In shipbuilding, South Korea and Japan follow with 53%.

According to data shared by Sand, the 2025 order book for new ships shows that China accounts for 75 percent of orders, South Korea accounts for 19 percent, and the United States accounts for 0.2 percent.

“When you look at the orders, it’s a challenge to make American shipbuilding great again. Foreign expertise needs to be brought in,” Sand said.

Notable foreign companies involved in US shipbuilding

The Trump administration has signed agreements with foreign shipbuilders to support the nation’s shipbuilding and training of U.S. workers.

Three shipbuilding subsidiaries of South Korea-based Hanwha Group, the world’s third largest shipbuilder, play an important role in this plan.

During July trade negotiations, South Korea and the United States announced a $350 billion deal. investment agreement150 billion dollars of this money will be allocated to maritime investments. general trade agreement It was completed in November with the reduction of auto tariffs on U.S. imports from Korea from 25 percent to 15 percent.

“Why reinvent the wheel? There’s a good reason why friends and allies work together and leverage a company’s expertise and experience,” Sand said.

South Korea has begun to increase its presence in the US maritime industry with an investment of $100 million in 2024. win Philly Shipyard in Philadelphia from Norwegian industrial investment group Aker ASA. The shipyard’s name was later changed to Hanwha Philly Shipyard.

In August, Hanwha Group announced a $5 billion infrastructure plan, part of a $150 billion investment that will ramp up the facility so Hanwha Philly Shipyard can increase its ship production capacity from 1-1.5 ships per year to 20 ships per year.

Hanwha Philly Shipyard received its first order for a US-built, export-ready LNG carrier in July from Hanwha Shipping, the shipping arm of Hanwha Group. This was the first order in nearly 50 years. The second LNG ship order was placed in August. Deliveries are expected around 2028 and are made possible through a model co-built with Hanwha Ocean’s Geoje Shipyard in South Korea. The joint construction model is a necessity due to the lack of shipbuilding capacity and personnel at the shipyard in Philadelphia.

Hanwha Ocean produces 50-60 ships per year.

“One of the challenges facing the industry is workforce,” said David Kim, CEO of Hanwha Philly Shipyard.

Kim says the biggest bottleneck in training the workforce is a shortage of U.S. instructors. To address this situation, Hanwha will move its U.S. workforce from Philadelphia to a shipyard in South Korea to train employees. “This is our biggest advantage,” Kim said. “The people who are good and the people you want to train U.S. workers for are the people who work in the yard,” he added.

The company also plans to expand its apprenticeship program.

“To date, we have 1,700 employees,” Kim said. “If you look at our ambitions to deliver these 20 ships a year, you will see that the number of our personnel will increase to over 10,000 in the future,” he added.

Oil creates demand for LNG and US cargo ships

LNG ship orders are not the only orders generated by the Hanwha company for the Philly shipyard. Hanwha Shipping also ordered 10 medium-range tankers for use in oil and chemical transportation. Largest US commercial ship order in more than two decades. The first ship is expected to be launched in 2029.

“There are currently 55 Jones Act oil tankers and 7,500 oil tankers in the world,” said Andy Lipow, president of Lipow Oil Associates.

The Jones Act requires ships carrying goods between U.S. ports to be U.S.-built, owned, crewed and flagged.

“LNG is, for all intents and purposes, not involved in the U.S. shipbuilding industry,” Lipow said. “There are approximately 750 LNG tankers in the world and there is only one US-flagged LNG tanker and it was built in France,” he said.

But the lack of US-made tankers has not affected the growth of US LNG exports or crude oil.

“The United States LNG market is not at a disadvantage. We currently export almost 30% of our crude oil production and have no problems finding tankers,” Lipow said.

Nuclear maritime targets

During Trump’s latest Asia tour, the president visited Hanwha First nuclear-powered submarine at Philly Shipyard. Hanwha produces large naval submarines in South Korea.

“The United States needs the ability to build ships and submarines for its security and resilience,” said Alex Wong, global chief strategy officer at Hanwha Group. “God forbid, in times of war you need the ability to regenerate and build a military ship,” Wong said. “This way you not only win the war, you also deter war.”

In August, Trump ordered the movement of two nuclear submarines in response to threats from Russia.

The timing of the submarine to be built at the Hanwha Philly Shipyard depends on ongoing discussions between the South Korean and US governments.

“What matters in terms of time is the availability of technology and resources,” Kim said.

The US Navy continues to build its technological infrastructure. Navy and Palantir Technologies recently announced “ShipOS” software They said it would help build and maintain American submarines. Future software could also be used for aircraft carriers and jets.

Italian shipbuilder with Wisconsin ties also playing a role

Finnish and Italian companies, as well as South Korea, are being used to expand U.S. shipbuilding. Italian Prime Minister Giorgia Meloni reaffirmed the country’s commitment to US shipbuilding in a joint statement with Trump at the meeting in April.

The key Italian company in this initiative Fincantieri Marinette Marine (FMM)In 1942, under the name Marinette Marine, he was stationed in Wisconsin during World War II. A company founded to build naval ships for World War II and later acquired by an Italian company. President Trump toured the company’s Wisconsin shipyard during his first term.

The company recently laid off 93 employeesIt comes nearly a week after the Navy canceled an order for four frigate ships to be built in Wisconsin. The company will now build two buildings instead of six.

Besides the Navy, Fincantieri also produces other commercial vessels such as LNG and cruise ships. Wisconsin shipyards are considered among the most modern and advanced shipyards.

“There are many hands touching the ship here,” said George Moutafis, CEO of Fincantieri Marine Group. “Almost all 3,000 employees are involved in the joint effort across three sites.”

A network of suppliers for ship components or materials increases overall employment related to shipbuilding.

“We have about 800 suppliers in 40 states, 300 of those suppliers are in Wisconsin and Michigan,” Moutafis said. he said. “So shipbuilding takes a village and more,” he added.

Race for control of the North Pole

The United States is also falling behind in the shipbuilding race for ships to break the polar ice. The US Coast Guard has three icebreakers. As of 2022 data, Russia has the world’s largest polar fleet, with 57 icebreakers and ice-capable patrol ships. China has five icebreakers.

The US ship Polar Star was rated as a heavy icebreaker and deployed to Antarctica. That ship is 49 years old. Two medium icebreakers, USCGC Healy (25 years old) and USCGC Storis (built 2012, acquired Modified and replaced by USCG in 2024), is rated as a medium icebreaker and is used on the Arctic route.

The US government’s crackdown on the Arctic is linked to: defense matters. The Northern Sea Route follows Russia’s Arctic coast, and the Northwest Passage, which crosses the Canadian Arctic Archipelago, cuts travel time between North America and Europe by several weeks. If ships did not use this polar route, ships would have to go around North America and pass through the Panama Canal or Suez Canal.

In the future, the Transpolar Sea Route, a mid-ocean route around the central Arctic, offers the shortest distance but requires heavy icebreakers and is largely covered in ice. To close the gap in polar icebreaker production, the USA is turning to Finland, known as the leading country in polar icebreaker production and design.

On October 9, the United States and Finland signed a memorandum of understanding on icebreaker construction at the White House. The $6.1 billion deal envisioned the U.S. Coast Guard purchasing 11 new icebreaking ships. Under the agreement, Finnish shipyards Helsinki Shipyard (owned by Canada-based Davie Defense) and Rauma Marine Constructions will build four arctic safety cutters, while US shipyards will build an additional seven. The first icebreaker is planned to be delivered in 2028.

In November, a joint statement of intent was announced between the United States, Canada, and Finland to advance shipbuilding and Arctic defense cooperation under the Icebreaker Cooperative Efforts (ICE) Pact, which was first announced in July 2024 by President Biden, then-Canadian Prime Minister Justin Trudeau, and Finnish President Alexander Stubb at the NATO Summit in Washington, DC.

Davie’s acquisition of Gulf Copper & Manufacturing Corp. in early December shipbuilding assets The deal at Port Arthur and the Port of Galveston, Texas, was approved by the Committee on Foreign Investment in the United States, which reviews foreign acquisitions on national security grounds.