Growth Likely on the Horizon for America’s Shipyards in 2nd Trump Administration
As the United States approaches its 250th anniversary, the shipbuilding industry is experiencing a revival. The Biden Administration has seen a notable increase in legal and regulatory work related to shipyards. This trend is expected to accelerate with the anticipated second term of Donald Trump. Once a thriving sector with over 300 shipyards in the early 1980s, the American shipbuilding industry has dwindled to around 20 private and public shipyards today. Despite this decline, these remaining shipyards are bustling with orders from both the government and private sectors. This surge in demand highlights the need for a strategic government approach to shipyard revitalization. Strengthening this sector is crucial for national security and economic stability.
The Importance of Modernizing Shipyards
Rebuilding America’s maritime base is essential for maintaining a strong U.S. Navy and supporting various commercial and civilian vessels. These vessels are vital for global trade, supply chains, and renewable energy projects, such as offshore wind farms. The shipbuilding industry sits at the crossroads of two key promises from President-Elect Donald Trump: enhancing national security and revitalizing America’s industrial base. A continued focus on these promises, combined with the Biden Administration’s emphasis on private sector partnerships, could lead to significant advancements in shipyard modernization and the establishment of new shipyards.
China currently dominates the global shipbuilding market, capturing 59% of new orders in 2023, which is double that of South Korea, the next closest competitor. In stark contrast, the U.S. holds a mere 0.13% of the market. This disparity raises serious concerns about China’s influence over shipbuilding prices and the global trade of essential goods. It also poses risks regarding the provision of warships to key U.S. allies. During his 2016 campaign, Trump highlighted these issues, and his first administration attempted to address them, despite facing challenges in Congress. In March 2020, budget cuts reduced new ship construction by 20%. However, the “Battle Force 2045” initiative, unveiled in December 2020, aimed to enhance the Navy’s fleet capacity and recognized the importance of the maritime industrial base.
Future Prospects for U.S. Shipyards
The Biden Administration has also prioritized the rebuilding of America’s shipyards. In 2021, President Biden proposed a $2.25 trillion infrastructure package, which included legislation aimed at improving shipyard facilities through the bipartisan Shipyard Act. Unfortunately, these early initiatives resulted in only a small fraction of infrastructure funds being allocated to shipyards. The Shipyard Act itself stalled in committee and ultimately expired without a vote. Nevertheless, the Biden Administration shifted its focus to public-private partnerships. In 2024, one of the world’s largest commercial shipbuilders committed to supporting the Navy’s shipbuilding program through collaborative initiatives with U.S. companies and educational programs. Additionally, a major private shipyard pledged to play a crucial role in developing a fleet of polar icebreakers for the U.S. Coast Guard.
As President-Elect Trump prepares to take office in January 2025, he appears to be doubling down on private sector partnerships. In a recent call with South Korean President Yoon Suk Yeol, Trump expressed interest in enhancing collaboration between U.S. and South Korean shipbuilders. This initiative is expected to build on the recent growth of South Korean shipbuilders in the U.S. market, including the acquisition of an East Coast shipyard. The bipartisan Ships for America Act, introduced in December 2024, aims to incentivize shipyard development and improve dry dock and repair facilities. Key nominees for the upcoming Trump Administration, including Rep. Mike Waltz and likely incoming Secretary of State Marco Rubio, support the Shipyard Act. These developments suggest that U.S. shipyards are poised for significant investments and a renewed focus on modernization and expansion, benefiting from bipartisan support and a growing emphasis on public-private partnerships.
