US legislation opens doors for S. Korean shipbuilders

The U.S. Congress is considering a bill that would allow allied nations to participate in constructing U.S. Navy vessels, a move that could present significant opportunities for South Korea’s globally competitive shipbuilding industry. The proposal follows remarks from President Donald Trump emphasizing the need for closer collaboration between the United States and the Republic of Korea to bolster naval capacity.

If enacted, the bill would permit the construction of entire naval vessels or their components in NATO member states and Indo-Pacific countries that have signed mutual defense agreements with the U.S. However, participating nations would be required to secure prior authorization from the U.S. Navy to ensure their shipbuilding facilities are neither owned by Chinese firms nor affiliated with multinational corporations headquartered in China. Additionally, shipbuilding costs in these allied nations must be lower than those of domestic U.S. shipyards. Senator Lee, a key proponent of the bill, underscored its strategic importance, stating, “The Force Structure Assessment for the United States Navy has projected a force of 355 ships will be minimally necessary to ensure a ready and capable Navy. Currently, the U.S. Navy operates with only 291 ships,” highlighting the imperative of statutory amendment.

South Korea’s shipbuilding sector has responded positively to the proposed legislation, anticipating increased access to the lucrative U.S. naval market. While the bill does not explicitly name specific countries, South Korea and Japan are the only Indo-Pacific allies with the capacity to construct warships at lower costs than the U.S. A spokesperson from HD Hyundai Heavy Industries expressed enthusiasm for the initiative, stating, “We have the proven track record and construction capabilities to meet the performance, cost, and delivery requirements for Aegis-class ships with specifications similar to those of the U.S. Navy. We welcome the opportunity for allies to participate in constructing U.S. ships.”

The U.S. naval market is estimated to be worth 20 trillion won annually—more than double that of the U.S. ship maintenance, repair, and overhaul (MRO) industry.


Ji-Sun Choi aurinko@donga.com