US Is Depending on S. Korea and Japan for Shipbuilding to Combat China

The U.S. is seeking South Korea and Japan for their shipbuilding expertise to combat China. This comes as the U.S. is in need of South Korean expertise in efficiency due to the U.S. Navy maintenance backlogs, along with Chinese shipbuilding shares are starting to decline.

U.S. Lawmakers are visiting South Korea and Japan to see how they could help with their shipbuilding expertise. The Associated Press reports, “American lawmakers are using a trip to South Korea and Japan to explore how the United States can tap those allies’ shipbuilding expertise and capacity to help boost its own capabilities, which are dwarfed by those of China.”

Moreover, on the 25th of August, there will be a summit between the leaders of South Korea and the U.S. Prime Minister Kim Min-seok called attention to the need to exhibit its position as “an equal partner to the U.S.” in the upcoming summit in Washington D.C. between U.S. President Trump and President Lee Jae Myung, according to The Korea Herald.

The Korea Economic Daily reports that to bolster Seoul-Washington efforts, South Korean conglomerate, HD Hyundai Co. will develop quantum cryptography communication connecting shipbuilders with South Korean defence contractors.

Make America Shipbuilding Great Again (MASGA) proposed $150 billion investment from Korea`s world-class shipbuilders toward the U.S. maritime sector which includes the upgrade of U.S. shipyards, training U.S. workers and aiding U.S. Navy maintenance backlogs along with co-producing American vessels, The Diplomat reports.

An urgent need for the expertise in efficient shipbuilding and repair from South Korea developed from the U.S. Navy`s maintenance backlog, which is a $200 billion problem.

According to AInvest, In Philadelphia, Hanwha Philly Shipyard has increased its workforce by 40% with robotic welding systems introduced. These investments are just more than shipbuilding but ingraining Korean firms into the U.S. defense industrial base.

The Navy`s maintenance issues come from issues like unstable funding, aging infrastructure, and overly complex designs also creating new-construction delays, National Security Journal reports.

The joint ventures could focus on construction and repair of US Navy non-combatant vessels. Baird Maritime reports, “If established, the joint ventures will focus on the construction and repair of US Navy non-combatant vessels for operation in the
Indo-Pacific as well as small craft for the US Army.”

Finalized this month, apart from tariff reductions, the U.S.-South Korea trade agreement is focusing on supply chains and industrial priorities, according to AInvest.

Business Standard, a newspaper from India, reports that in the first half of the year China`s share of new ship orders dropped from 75% to 56% while South Korea saw their share rise from 14% to 30%.

Even early last year China`s shares had started to drop. From the first half of 2024 to the same period this year, their global contracting share weakened from 72% to 52%, according to Riviera.

Moreover, the U.S. Trade Representatives (USTR) are implementing port fees in October. According to GCaptain, maritime news website, it will impact Chinese ship owners and operators along with Chinese-built ships but exempts smaller sector-specific vessels and short haul crossings.

BIMCO shipping analysis manager Filipe Gouveia said that while China is anticipated to retain its lead position in shipbuilding, countries such as the Philippines and Vietnam are already becoming competition because they are smaller producers of bulkers and tankers, measuring up output by using lower labour costs, Riviera reports.