The SHIPS Act Won’t Save American Maritime Dominance—Here’s What Might

How China Outbuilt the U.S. and Why a 250-Ship Fleet Isn’t Enough

For 65 years, the U.S. maritime industry has been in free fall. Once a global leader, American shipyards now produce a fraction of the tonnage churned out by China, which controls nearly half the world’s commercial shipbuilding. Japan and Korea leapfrogged the U.S. decades ago, leaving Washington scrambling to revive a sector critical to both trade and national security. Enter the SHIPS for America Act—a well-intentioned but flawed attempt to stem the bleeding.

“This isn’t just about economics. It’s about whether the U.S. can project power or even feed itself in a crisis,” says a retired Navy logistics officer.

Reintroduced in April by Senator Mark Kelly and bipartisan allies, the Act proposes a 10-year plan to build a 250-ship U.S. flag fleet. But critics warn it prioritizes quick fixes—like reflagging foreign-built vessels—over rebuilding domestic capacity. The bill’s Strategic Commercial Fleet Program offers seven-year operating agreements, yet ignores a glaring weakness: America’s atrophied repair yards, which are essential for maintaining skilled labor pipelines.

One bright spot? The Act could incentivize U.S.-built MR 2 product tankers, which gain exclusive coastwise trading rights under the Jones Act. But without subsidies to offset China’s cost advantages, these ships risk becoming white elephants. Meanwhile, the U.S. container fleet maxes out at 3,400 TEU—a fraction of the 24,000 TEU behemoths deployed by Asian rivals. That gap isn’t just embarrassing; it’s a strategic liability when military planners rely on civilian hulls for sealift.

The proposed Maritime Trust Fund, bankrolled by tariffs on Chinese vessels, faces skepticism. Analysts doubt it can generate the billions needed to modernize rusting shipyards. “You can’t rebuild an industry on penalty taxes,” argues a Baltic Exchange analyst. “China’s state-backed model operates at a scale we can’t match without similar commitment.”

Instead, some suggest pivoting to dry bulk carriers—a workhorse of global trade with untapped military potential. These ships could haul grain to conflict zones or coal during energy crises, offering dual-use flexibility. Post-Ukraine reconstruction alone may demand hundreds. But without a coherent industrial policy, even this niche opportunity could slip away. The SHIPS Act is a start, but America needs more than life support—it needs a revolution.