The U.S. Department of Defense plans to invest approximately 1 trillion USD over the next 30 years to expand its combat fleet. President Donald Trump has aligned with this initiative through an executive order aimed at revitalizing the shipbuilding industry. However, experts emphasize that collaboration with allied nations like South Korea is crucial due to practical limitations.
On April 9, Trump signed an executive order to restore U.S. maritime dominance, seeking to bridge the quantitative gap with the Chinese Navy and reinvigorate the U.S. shipbuilding sector.
While the U.S. Navy is often hailed as the world’s strongest, it has ceded the title of the world’s largest to the Chinese Navy.
China’s naval forces boast over 400 combat vessels, while the U.S. Navy operates 296 vessels.
This disparity is expected to widen further over time.
Last month, the Pentagon submitted a proposal to Congress outlining plans to increase the combat fleet to 381 vessels over the next three decades.
To offset the retirement of vessels and achieve net growth, the Navy must acquire approximately 364 new vessels over the next 30 years.
The Congressional Budget Office estimates this effort will require a minimum annual budget of 40 billion USD, totaling around 1 trillion USD to reach the final goal.
While this presents a significant opportunity for the South Korean shipbuilding industry, the executive order specifies that allied nations like South Korea should be encouraged to invest in American shipyards.
However, doubts persist both domestically and internationally about the U.S. shipbuilding industry’s capacity to meet the Navy’s ambitious goals independently.
Park Jinho, a policy advisor at the South Korean Ministry of Defense, argued in a column of the PacNet, a publication of the Center for Strategic and International Studies’ Pacific Forum, that the U.S. cannot single-handedly revive its shipbuilding industry. He emphasized that collaborating with allied nations like South Korea in the shipbuilding sector is the most effective strategy.
Park suggested that Hanwha Ocean and HD Hyundai Heavy Industries could play pivotal roles in expanding the U.S. Navy’s combat fleet.
He cited Hanwha Ocean’s acquisition of a Philadelphia shipyard, where it now handles maintenance, repair, and overhaul for the U.S. Navy. Additionally, HD Hyundai Heavy Industries plans to invest up to 200 million USD in developing small modular reactor-powered vessels with TerraPower by 2030.
The South Korean shipbuilding industry’s attractiveness is further bolstered by U.S. shipyards’ repeated delays in warship delivery for one to three years and quality concerns.
A recent U.S. Government Accountability Office report on naval shipbuilding revealed that despite doubling the warship construction budget over the past two decades, fleet size has not increased due to persistent delivery delays.
The New York Times reported on experts’ skepticism regarding Trump’s approach of seeking investment from South Korean shipbuilders without allowing them to participate in construction.
From the South Korean shipbuilding industry’s perspective, investing in U.S. shipyards can be risky due to skilled labor shortages, limited commercial ship orders, and regulatory and political barriers to foreign participation in the U.S. defense industry.
The NYT also noted that Trump’s high tariffs on imported materials, including steel used in shipbuilding, could further erode the global competitiveness of American-built vessels.