Trump Seeks South Korea’s Help to Revive U.S. Shipbuilding Industry
November 8th, 2024
U.S. President-elect Donald Trump recently requested South Korea’s cooperation in shipbuilding and maritime maintenance (MRO) during a call with President Yoon Suk Yeol. Trump acknowledged South Korea’s global leadership in shipbuilding and emphasized the need for collaboration beyond ship exports, particularly in the MRO sector. This unusual request highlights concerns over the U.S. shipbuilding industry's decline and Washington’s growing competition with China.
The Decline of U.S. Shipbuilding
Once a powerhouse, the U.S. shipbuilding industry has dramatically weakened, contributing only 0.13% to global ship production in 2023. In contrast, China leads the sector, with an industry 230 times larger than that of the U.S. The decline has significantly impacted the U.S. Navy, where nearly 40% of attack submarines are awaiting repairs, leading to severe delays. The USS Connecticut, for instance, took 20 months to begin repairs, with maintenance expected to last over 31 months.
As China expands its naval fleet, overtaking the U.S. in warship numbers (370 vs. 280), Washington is urgently seeking to revitalize its shipbuilding capacity. Recognizing this, U.S. officials have visited South Korean shipyards to explore potential investments and collaborations.
Strategic Partnership with South Korea
South Korea’s shipbuilders—Hyundai Heavy Industries, Samsung Heavy Industries, and Daewoo Shipbuilding—are already expanding their presence in the U.S. market. Some have acquired American shipyards and secured MRO contracts. With the U.S. Navy’s MRO market valued at $15 billion annually, these partnerships could be crucial.
Trump’s request signals an acceleration of these collaborations, potentially allowing South Korean firms to modernize U.S. shipbuilding infrastructure and reduce maintenance backlogs. This would bolster the U.S. Navy’s readiness while benefiting South Korea economically through expanded business opportunities.
Challenges and Considerations
Despite potential benefits, obstacles remain. The Jones Act, which mandates U.S.-built ships for domestic trade, could limit foreign involvement. Additionally, Trump’s “America First” policies may complicate large-scale foreign investment. Nevertheless, the urgency of shipbuilding revitalization may outweigh protectionist concerns.
China’s response is another factor. As the U.S. and South Korea strengthen their shipbuilding ties, China may employ aggressive pricing strategies to maintain dominance. South Korean firms must navigate these dynamics carefully.
Conclusion
Trump’s direct appeal underscores the strategic importance of shipbuilding. As the U.S. struggles with a weakened industry and China’s naval expansion, South Korea’s advanced shipbuilding capabilities offer a viable solution. Strengthening this partnership could enhance U.S. naval readiness, bolster economic ties, and reinforce both nations’ positions in an evolving geopolitical landscape.
