Korea, US must anchor ties in shipbuilding

Then Deputy Prime Minister Choi Sang-mok with his trade minister convened a “2+2 Trade Consultation” with their American counterparts on April 25 to address Washington's recent threat of a 25 percent tariff and to explore cooperation amid rising geopolitical tensions. Notably, discussions extended beyond tariffs, highlighting sectors for potential collaboration, including the shipbuilding industry.

The post-1953 paradigm of Korea as security client and America as security guarantor has grown increasingly anachronistic. Its asymmetry has created inherent vulnerabilities in the alliance’s foundations, vulnerabilities laid bare whenever Washington consideres a new regional strategy or contemplates rebalancing its presence on the peninsula.

What has become clear in recent weeks is that Korea must seek recognition as an essential industrial partner in America’s strategic calculus that goes beyond tariff exemptions. Alliances endure when they reflect mutual indispensability rather than unilateral dependency, and a partnership between Korean and American shipbuilding industries could deliver just that.

America's maritime dominance has been declining to the extent that on April 9, the White House issued an executive order titled "Restoring America's Maritime Dominance." This directive, coupled with the establishment of the White House Shipbuilding Council and SHIPS Act, signals rare bipartisan recognition of the shipbuilding agenda. The U.S. is aware that China's 232-fold advantage in shipbuilding capacity constitutes not merely an industrial concern but a challenge to national security.

The numbers tell a compelling story: Over 80 percent of U.S. shipyards have closed since the 1980s, with production capacity reduced to fewer than five vessels annually. Meanwhile, China's naval fleet is projected to reach 460 vessels by 2030, dwarfing America's current 260-ship navy. The gap in the shipbuilding capacity is an undeniable threat to American interests, whether one looks at maritime strength as a strategic military asset upholding freedom of navigation or as a linchpin of the global supply chain resilience.

Reviving its shipbuilding industry is a generational undertaking for the United States, but one that requires more than just domestic investment. To close the gap, revitalize American industry and breathe new life into the alliance, Seoul and Washington should pursue a strategic partnership that brings industrial cooperation to the forefront.

As the world's second-largest shipbuilding nation, Korea possesses a unique value-add in this recalibrated alliance calculus. With firms like HD Hyundai and Samsung Heavy Industries operating at productivity rates two to three times higher than their U.S. counterparts, Korea provides what may be the only viable pathway to American maritime revitalization within strategically relevant timeframes.

Korea's 27 percent share of global ship orders in 2025 reflects not just market dominance but accumulated expertise that would require decades for America to reconstitute independently. Korea possesses capabilities America urgently requires, while America possesses market access and security guarantees that Korea values.

For the new partnership to succeed, it should operate through a dual-shore approach that transforms the traditional U.S.-Korea military alliance into an integrated industrial base.

The first component focuses on American shores. Hanwha Ocean's acquisition of Philly Shipyard in 2024 provides the blueprint for the American component: Korean manpower and capital revitalizing American industrial infrastructure, while creating politically consequential employment across key congressional districts. Expanding this model would inject Korean expertise and best practices into American production while broadening the base of political support for the alliance. While the president can undermine a mutual defense treaty unilaterally, an industrial alliance supporting thousands of jobs across America becomes far more resilient.

The second component centers on Korean shores. HD Hyundai's announcement regarding potential production of Aegis destroyers for the U.S. Navy demonstrates how existing Korean capacity can immediately address America's naval requirements while domestic infrastructure matures. Hanwha's maintenance services for the USNS Wally Schirra further illustrates how Korean ports can support American forward deployment in the Indo-Pacific. By institutionalizing production and servicing contracts, Korean shipbuilders can help build up the American fleet while sustaining forward-deployed operations and generating business.

Beyond tariff diplomacy

For Korean policymakers, this represents an inflection point that transcends narrow concerns about tariff exemptions. The strategic question is whether Korea can position itself as the indispensable partner in America's maritime revitalization and thereby transform the alliance from hierarchical dependency to symbiotic necessity.

This approach addresses legitimate Korean concerns about industrial hollowing and brain drain by creating transnational production networks rather than one-way talent flows. It simultaneously offers Korean firms privileged access to American commercial and defense contracts while positioning them as trusted alternatives in global supply chains increasingly concerned about overdependence on Chinese manufacturing.

For American strategists, this partnership offers the only plausible pathway to maritime revitalization. By leveraging Korean expertise while rebuilding domestic capacity, America can address immediate naval requirements while developing long-term industrial resilience.

What emerges from this reconfiguration is a more sophisticated alliance architecture — one predicated on mutual indispensability rather than asymmetric dependency. By integrating industrial and security considerations, both nations can create a relationship resistant to political volatility and administrative change.

Park Jin-wan is a nonresident fellow at the European Centre for North Korean Studies at the University of Vienna. Arjun Akwei is a Schwarzman Scholar and a former research associate at Harvard University’s Weatherhead Center for International Affairs