Posted on October 26, 2026
The Wall Street Journal (WSJ) reported on October 25 (local time) that South Korea and Hanwha are playing a pivotal role in the Donald Trump administration’s plan to revive the U.S. shipbuilding industry. To restore America’s shipbuilding capabilities, which lag far behind China’s, the U.S. requires technology and investment from allies like South Korea. However, high production costs and uncertain prospects for military ship orders remain significant hurdles.
The WSJ article opened with Republican Senator Dave McCormick of Pennsylvania visiting Hanwha Ocean’s Geoje shipyard as part of efforts to revive the U.S. Navy’s shipbuilding sector. The facility, featuring a massive Goliath crane, automated steel-cutting equipment, and robotic arms, was described as larger and more technologically advanced than any U.S. shipyard.
President Trump has pledged to expand U.S. shipbuilding capacity to usher in a “maritime golden age.” Yet, American shipyards currently account for less than 1% of global production. China, the world’s largest shipbuilder, has a capacity over 230 times that of the U.S. The WSJ highlighted Hanwha’s investment in Philly Shipyard as a prime example, stating, “The U.S. needs allies’ help to revive the industry.”
Since acquiring Philly Shipyard in December 2024, Hanwha has invested approximately 350 million dollars in facility upgrades. An additional 400 million dollars in investments has been approved by the end of next year, with plans for further multibillion-dollar investments. The South Korean government also pledged 150 billion dollars in investments to the U.S. shipbuilding sector as part of a bilateral trade agreement last year.
Hanwha’s involvement in U.S. Navy projects is growing. In March, it secured a subcontract to support the initial design of a next-generation military support ship. Earlier this month, it was selected alongside a Florida-based ship management company to build a specialized auxiliary vessel for Trump’s “Golden Dome” missile defense system. The contract, initially for one ship with options for three more, could reach up to 2 billion dollars, according to the White House.
Philly Shipyard currently builds auxiliary naval ships and aims to secure certification for combat ship construction by 2028. Last month, Hanwha agreed with local authorities to expand the shipyard’s site by approximately 40%. Plans include constructing a new training center, upgrading facilities to boost production capacity, and introducing virtual reality (VR)-based painting training equipment, welding tools, and collaborative robots used in South Korea.
Structural challenges in the U.S. shipbuilding industry persist, however. High production costs, shortages of suppliers, labor recruitment difficulties, and site expansion constraints are cited as obstacles for Philly Shipyard. Uncertainty also surrounds how many ships the Pentagon will order in the long term. The WSJ noted that ally companies like those from South Korea and Japan need assurance on future orders to expand their U.S. presence. However, annual defense bills supporting related budgets have yet to pass Congress. The House bill blocks funding for combat-capable ships built in foreign shipyards, while the Senate version includes provisions allowing treaty allies’ shipyards to be used for certain non-combat vessels.
Despite these uncertainties, Hanwha is pushing to expand its U.S. operations. In August, it made a non-binding acquisition offer exceeding 1 billion dollars for Austal USA’s shipyard in Mobile, Alabama, with negotiations ongoing. Alex Wong, Hanwha Group’s global chief strategy officer (CSO), stated, “Our goal is to increase orders from the U.S. Department of Defense,” adding, “The next step is to have commercial and naval shipyards operating side by side.”
Senator McCormick warned, “The world won’t wait for us to get ready,” urging faster action. He emphasized, “A long-term commitment is necessary if we’re serious about shipbuilding.”
