President Donald Trump is turning his attention to the U.S. shipbuilding industry, which is leagues behind its near-peer competitor China, and recently signed an executive order designed to reinvigorate it.
Trump’s April 10 order instructs agencies to develop a Maritime Action Plan and orders the U.S. trade representative to compile a list of recommendations to address China’s ‘anticompetitive actions within the shipbuilding industry,’ among other things.
Additionally, the executive order instructs a series of assessments regarding how the government could bolster financial support through the Defense Production Act, the Department of Defense Office of Strategic Capital, a new Maritime Security Trust Fund, investment from shipbuilders from allied countries and other grant programs.
But simply throwing money at the shipbuilding industry won’t solve the problem, according to Bryan Clark, director of the Hudson Institute think tank’s Center for Defense Concepts and Technology.
‘It is unlikely that just putting more money into U.S. shipbuilding – even with foreign technical assistance – will make U.S. commercial shipbuilders competitive with experienced and highly-subsidized shipyards in China, Korea, or Japan,’ Clark said in a Monday email to Fox News Digital. ‘In the near to mid-term, the government will need to also drive higher demand for U.S.-built ships.’
Clark also said the executive orders appear to complement the SHIPS for America Act, a series of legislative measures introduced in December 2024 in both the House and Senate aimed at fostering growth within the U.S. shipbuilding industry and strengthening the U.S. Merchant Marine fleet that is capable of transporting military materials during times of conflict.
Specifically, the SHIPS Act includes provisions establishing a Strategic Commercial Fleet Program, which would seek to develop merchant vessels that could operate internationally, but are American-built, owned and operated. The legislation would also seek to beef up the U.S.-flag international fleet by roughly 250 ships in 10 years.
‘If we implement the EO and the SHIPS Act together, the government would create incentives to flag and build ships in the U.S. and provide capital to the shipbuilding industry so it could meet the increased demand with greater efficiency and lower costs,’ Clark said. ‘This will not result in the U.S. surpassing China, Korea or Japan as shipbuilders, but it would provide the U.S. more resilience.’
The U.S. is drastically behind near-peer competitors like China in shipbuilding. China is responsible for more than 50% of global shipbuilding, according to the Center for Strategic and International Studies, compared to just 0.1% from the U.S.
However, Trump has indicated interest in working with other nations on shipbuilding, and suggested working with Congress to pass legislation authorizing the purchase of ships from foreign countries when signing the orders. Specifics were not provided.
But doing so could upend a century-old law known as the Jones Act – a controversial law fundamental to the current U.S. shipbuilding environment that requires that only U.S. ships carry cargo between U.S. ports and stipulates that at least 75% of the crew members are American citizens. It also requires that these ships are built in the U.S. and that U.S. citizens own them.
Proponents of the Jones Act assert it is key to national security and prevents foreigners from gaining entry to the U.S. But experts claim the law has significantly hampered U.S. shipbuilding, and is undercutting competition while keeping shipbuilding costs high.
Efforts to repeal the legislation have failed amid bipartisan support in Congress. But some experts claim eradicating the law is a first step in changing the shipbuilding industry in the U.S.
‘Anyone who is serious about reviving the shipping industry should basically start by getting rid of the Jones Act,’ Veronique de Rugy, a senior research fellow at the Mercatus Center at George Mason University, told Fox News Digital Thursday. ‘It’s not everything, but it’s a start.’
Colin Grabow, an associate director at the Cato Institute’s Center for Trade Policy Studies, said shipbuilding issues in the U.S. are multifaceted, but the Jones Act is a major part of the problem. Still, he doubts efforts to repeal it will prove successful.
‘I think the bar has been set so low, it is hard not to think that, absent the Jones Act, that we’d be doing any worse,’ Grabow said. ‘And in fact, I think we’d do better. And why do I think we’d do better? It’s because… fundamentally, I think an industry that doesn’t have to compete will become uncompetitive. I think it’s just kind of axiomatic.’
