U.S. Pushes Dual-Use Shipbuilding With Japan as China’s Fleet Surges

The United States has launched a new effort to rebuild its shipbuilding industry by proposing a dual-use shipbuilding partnership with Japan, according to information provided to Nikkei Asia by U.S. Navy Secretary John Phelan.

This move comes as China’s shipbuilding capacity and naval fleet size have reached levels that far outpace the United States, raising urgent concerns in Washington and among American businesses involved in maritime trade and defense.

China’s state-backed shipyards now produce more commercial ships by tonnage each year than the entire U.S. shipbuilding industry has since World War II. In 2024, China’s shipbuilding sector accounted for over 50 percent of global output, while the U.S. share dropped to just 0.11 percent.

The U.S. Navy’s fleet stands at 296 battle force ships, but China has more than 370, with projections showing China may reach 425 ships by 2030. U.S. intelligence estimates China’s shipbuilding capacity is 232 times greater than America’s.

The U.S. government, under the Trump administration, has responded with new executive orders and policy initiatives designed to revive domestic shipbuilding. These include federal funding, regulatory streamlining, workforce training, and Buy American policies.

The administration aims to expand the U.S. Navy to 381 ships and eventually 390 by 2054, but faces significant hurdles. U.S. shipyards struggle with workforce shortages, aging infrastructure, and a maintenance backlog of up to 4,000 days and $1.8 billion in repairs.

U.S.-Japan Shipbuilding Proposal

U.S. shipyards build only about five ships a year, while China’s output numbers in the hundreds. The dual-use shipbuilding proposal seeks to address these gaps by leveraging Japan’s advanced shipyards and expertise.

The plan involves building commercial ships that can be rapidly converted for military use, mirroring China’s approach of integrating military features into civilian vessels from the design stage.

This strategy aims to boost U.S. and allied capacity to surge logistics and support in a crisis, while also creating new business opportunities for shipyards and suppliers in both countries.

The U.S.-Japan partnership already includes maintenance and repair operations in Japanese shipyards, which helps reduce downtime for U.S. Navy vessels and allows American yards to focus on new builds.