Make the American shipbuilding industry great again! Can South Korea's extravagant $150 billion reshape the global shipbuilding market landscape?

During the first official visit of South Korean President Lee Jae-myeong to the United States, he repeatedly promised to promote "Making American Shipbuilding Great Again", while both sides are in discussions on other details of their trade and security agreements. On Monday, Lee Jae-myeong held a summit with U.S. President Donald Trump; on Tuesday, he will visit a shipyard owned by the South Korean Hanwha Group to highlight related investment plans. According to South Korea's pledge to invest $35 billion in U.S. projects, shipbuilding has become one of the most specific investment areas, with the industry receiving special appropriations of $15 billion. Trump stated that he hopes to revitalize the American shipbuilding industry. As Lee Jae-myeong visits the Philadelphia Shipyard of Hanwha Group (one of the largest shipyards in the United States), the potential and potential risks of this investment project will become clear. The South Korean presidential office revealed that Hanwha Group acquired the shipyard last year, planning to invest up to $5 billion to increase its annual production from less than 2 ships to 20. In comparison, Hanwha Marine's shipyard in South Korea is 10 times the size of the Philadelphia Shipyard and can build one ship per week. After the summit, Lee Jae-myeong stated at an event at the Washington Center for Strategic and International Studies, "Having a globally leading South Korean shipbuilding industry will help revitalize the U.S. shipbuilding industry and create a historic new turning point for the mutual prosperity of the two countries." The South Korean presidential office mentioned that as part of the alliance's "modernization" plan, Lee Jae-myeong has agreed to increase South Korea's defense spending and play a greater role in addressing changes in regional political situations, but did not provide detailed explanations. The South Korean Ministry of Industry stated that during Lee Jae-myeong's visit, South Korean and U.S. companies signed 11 non-binding agreements in the fields of shipbuilding, nuclear energy, aerospace, natural gas, and critical minerals. In the field of shipbuilding, Hyundai Heavy Industries and the state-owned Korea Development Bank and Cyrus Capital reached an agreement to establish a joint investment fund worth billions of dollars, aiming to enhance the maritime capabilities of the United States and its allies, covering shipbuilding, marine logistics infrastructure construction, and advanced marine technology research and development. Samsung Heavy Industries also reached a cooperation agreement with Vigel Marine Group to collaborate in areas such as maintenance, modernization of shipyards, and joint shipbuilding for the U.S. military. A senior official from South Korea stated that the two countries have decided to sign a non-binding agreement that clarifies the operation and structure of the $35 billion investment fund agreed upon in the July trade deal. Legal and manufacturing obstacles In the tariff negotiations in July, South Korea proposed a package plan called "Making American Shipbuilding Great Again", with some parts aimed at helping U.S. shipyards modernize. South Korean government officials at the time claimed that this plan played a key role in reaching a trade agreement that was not formally signed by both sides. U.S. shipyards had the highest capacity in the world during World War II, but by 2024, their global market share had dropped to 0.04%. Data from the United Nations Conference on Trade and Development show that China and South Korea account for 83% of the global commercial shipbuilding market. During a meeting with Lee Jae-myeong at the White House, Trump stated, "We will put shipbuilding back on the map." However, experts, industry insiders, and South Korean officials all point out that achieving this goal will still require a lot of effort. Steve SK Jeong, responsible for global naval ships at Hanwha Marine, previously stated, "I believe the U.S. shipbuilding industry has long lacked competitive pressure, with outdated facilities and a shortage of technical personnel." Korean industry insiders revealed that training local workers could take 4 to 5 years, and it is difficult to find people willing to work in shipyards. Jeong stated that Hanwha Group is committed to advancing facility modernization, training and equipping workers, while introducing production processes that can significantly speed up shipbuilding. Hanwha Group stated that they plan to integrate unused dockyards near the Philadelphia Shipyard to expand construction capacity; additionally, they will optimize project management and use automated equipment such as welding Siasun Robot&Automation to accelerate production progress. However, procurement difficulties for components such as steel plates may hinder the project's progress. Trump stated that some ships will still be built in South Korea. He said, "We will buy ships from Korea, but we will also have them (Korean companies) work with our workers here in the U.S. to build ships." South Korean officials stated that unless the U.S. relaxes some protectionist policies, the scale of building entire ships in the U.S. or delivering ship modules to U.S. shipyards from Korea may be restricted. The Jones Act of 1920 in the U.S. stipulates that goods transported between U.S. ports must be carried by ships built in the U.S. Similarly, the Burdens-Tolfree Amendment prohibits the building of U.S. naval ships in shipyards outside the U.S., but the President has the authority to exempt this provision for national security reasons. Some U.S. lawmakers have proposed amendments to open the door for U.S. allies to participate more widely in the construction of U.S. naval ships. South Korean National Security Adviser Wi Sung-lac acknowledged these legal restrictions. He stated, "We are considering various alternative measures and institutional improvements, conducting comprehensive research to expand cooperation between South Korea and the U.S. in the field of shipbuilding."