HYUNDAI SAMHO SHIPYARD, SOUTH KOREA
By Seungheon Lee*
The U.S. shipbuilding crisis is not an economic footnote — it is a national security emergency. And the fastest path to fixing it is through Seoul.
If the United States and China went to war tomorrow over Taiwan, the outcome might hinge less on aircraft carriers or missiles than on a question almost no one is asking: which side can build ships faster? The answer, today, is not close. China launched more than 1,000 commercial vessels last year. The United States launched eight. That gap is not merely an industrial statistic. It is a measure of who can sustain a prolonged naval conflict — and it reveals a vulnerability America spent decades quietly creating for itself.
SOUTH KOREA’S SHIPBUILDING SUCCESS CAN HELP THE UNITED STATES
The United States cannot rebuild its maritime industrial base fast enough on its own — but it doesn’t have to.
South Korea is the world’s second-largest shipbuilder, a decades-long treaty ally, and already investing heavily in American yards. This is not a story about outsourcing jobs. It is about importing the industrial excellence the U.S. allowed to atrophy, partnering with the nation that built what America once had and never should have let go.
The deals are already taking shape under the Trump administration. In April 2025, HII — the largest U.S. naval shipbuilder — signed a memorandum of understanding with Hyundai Heavy Industries. Hanwha Ocean committed $5 billion to modernize Philadelphia Shipyard. South Korea’s MASGA initiative — “Make American Shipbuilding Great Again” — envisions up to $150 billion in Korean investment in U.S. yards, pairing Korean automation, precision manufacturing, and workforce training with American infrastructure. Seoul has since announced the establishment of a Korea-U.S. Shipbuilding Cooperation Centre in Washington, D.C., with a second location under consideration in Texas — a program specifically designed to deploy Korean specialists into American yards and rebuild the trade force from the shop floor up.
The collapse did not happen overnight.
As Japan, Korea and then China rose to industrial dominance, Washington made a fateful choice: cede commercial shipbuilding to cheaper Asian markets and focus U.S. yards exclusively on high-end naval work — nuclear submarines, aircraft carriers, amphibious ships. By the 1980s the last major American commercial yards had closed or converted. By the 2000s the knowledge base, workforce pipelines, and supply chains had emigrated to Asia permanently. The theory was that military shipbuilding could thrive in isolation. The reality has proven the opposite.
Commercial and naval shipbuilding are not separate industries — they are the same industry. They share the same physical inputs: steel plate, pumps, valves, electronic cabling, and trained tradespeople. When commercial work dried up, the vendor ecosystem of hundreds of component suppliers had no reason to stay. Yards that once hummed with mixed orders lost the throughput needed to justify investment in equipment and apprenticeship programs. The workforce atrophied. The supply chain contracted. And when the Navy placed orders for its most ambitious vessels, it was sending them into a hollowed-out industrial base — and paying the price ever since.
COST OVERRUNS BY U.S. NAVAL SHIPBUILDERS
The bill has arrived. The aircraft carrier USS Gerald R. Ford was authorized at roughly $10.5 billion; it delivered at $13.3 billion, a 26 percent overrun. The Government Accountability Office’s 2025 assessment found the entire naval shipbuilding sector “consistently over budget and behind schedule” — not from insufficient funding, but from structural industrial decay.[1] Virginia-class submarine production runs at roughly 60 percent of its annual goal for the same reason: the yards cannot find enough trained welders, electricians, and pipefitters.
CHINA LEADS BUT SOUTH KOREA CLOSING THE GAP
Meanwhile, China has seized the vacancy. In 2024, China built over 1,000 commercial vessels; the United States built eight. In 2024, China controlled nearly 70 percent of global shipbuilding market share. Shipbrokers’ data indicated that Chinese yards account for 68% of the global orderbook by vessel count, including 70% of bulk carriers, 68% of tankers, and 80% of containerships. Over 90% of large vehicle carriers on order are also attributed to China.[1]
That situation changed in 2025.
While China retained its position as the world’s top shipbuilder in 2025, its market share declined for the first time in five years as US threats to impose port fees on Chinese-linked vessels sparked market turbulence. Chinese shipyards secured 35.4 million compensated gross tonnage (CGT) of new vessel orders last year, down 35 per cent compared with 2024, the Chinese maritime news outlet eworldship.com reported on Thursday, citing data from shipping consultancy Clarksons.[2]
China’s shipbuilders also saw their global market share fall from 70 per cent in 2024 to 63 per cent last year – the first such drop recorded in half a decade, the report said.
South Korea, the world’s second-largest shipbuilder, gained ground as its market share rose from 17 per cent in 2024 to 21 per cent last year, with its new vessel orders growing 8 per cent year on year to reach 11.6 million CGT.[3]
The U.S. shipbuilding market share represents a fraction of one percent.
The Office of Naval Intelligence estimates China holds 230 times more shipbuilding capacity than the United States. Beijing’s “military-civil fusion” strategy deliberately links commercial production to military readiness — its commercial yards are, functionally, reserve naval facilities. In a prolonged conflict, China can build and replace vessels at a tempo America cannot match. This asymmetry does not just shape a battle; it determines whether the U.S. can sustain operations across the Pacific for months or years.
The question — which side can build ships faster? — has a present answer that should alarm every American strategist. But it does not have to be the permanent one.
CONCLUSION
Korean shipbuilders compressed into decades what the U.S. took generations to build, and then allowed to collapse. The answer is not to reinvent the wheel. It is to partner with the ally that still knows how to build one. The Korean partnership is not charity. It is the fastest credible path back to the kind of maritime power that, in 1943, could launch a new ship every seventeen days — and win.
*Seungheon Lee is currently researching at the Indo-Pacific Policy Lab at Stanford’s Center for International Security and Cooperation, studying US-China competition and foreign policy of Korea, China and the U.S. power states including China, North Korea and the U.S. (See: https://www.koreatimes.co.kr/opinion/20251208/iron-sword-or-invisible-sword-koreas-nuclear-future-and-its-implication) Previously, he was a legislative aide at South Korea’s National Assembly. (Note: The opinions expressed are the authors)
FOOTNOTES
[1] https://www.gao.gov/blog/u.s.-navy-shipbuilding-consistently-over-budget-and-delayed-despite-billions-invested-industry
[2] https://mykn.kuehne-nagel.com/news/article/china-maintains-shipbuilding-dominance-as
[3] https://www.scmp.com/economy/china-economy/article/3339308/chinas-shipyards-still-lead-world-us-threats-took-toll-2025