Trump: "We're Going to be Buying Ships From South Korea"
Shipbuilding was at the top of the agenda in talks between U.S. President Donald Trump and South Korean President Lee Jae Myung on Monday, and the outcomes included a pledge from Trump to buy ships from Korea.
In hopes of securing lower U.S. tariff rates and keeping the multibillion-dollar Korean auto industry competitive on the U.S. market, Seoul pledged an investment of $150 billion in America's shipbuilding sector. The bid was successful: Korea won a 10-point reduction in its tariff rate, putting its manufacturers on the same footing as competitors in Japan and the EU. To get the Trump administration to seal the deal, Korean trade officials came up with a slogan - "Make American Shipbuilding Great Again," or MASGA.
This gesture won the attention of the administration's trade negotiators, yielding a more favorable 15 percent tariff on Korean cars, computer chips and other exports. Trump's meeting with South Korean President Lee Jae Myung was the first major bilateral press conference after the deal was concluded, and it appeared to yield a result that fulfills the hopes of Korean yards as well: an American intention to buy Korean hulls.
"We're going to be buying ships from South Korea," Trump said. "We love their ships."
Trump told reporters that in the long term, "we're also going to have them make ships here with our people, using our people, and we're going to go back into the shipbuilding business again." As for timing, Trump emphasized that "it takes a while" and that "shipbuilding is a tough one to start."
In addition to favoring Korean ships, Trump has also spoken highly of Finnish shipbuilding. Earlier this year, he told reporters that he has negotiated personally with Finnish President Alexander Stubb on the terms for purchasing used and new icebreakers from a non-U.S. shipyard. Two Finland-based yards, Helsinki Shipyard and Rauma, are said to be bidding for a program to build medium icebreakers for the U.S. Coast Guard (in cooperation with local partners in the United States).
Korean state investment with U.S. guidance
Coinciding with the Trump-Lee meeting on Monday, the U.S. private equity giant Cerberus Capital Management announced a partnership with Korean shipbuilder HD Hyundai to launch a new "maritime investment strategy" focused on American shipbuilding opportunities. The new strategy, Cerberus Maritime, will also look for investment possibilities in the American maritime industry writ large, including maritime logistics, supply chains, infrastructure, ports and technology.
HD Hyundai will provide shipbuilding expertise and serve as an anchor investor in the partnership. In addition, it will bring with it the Korean government's state sponsor for shipping and shipbuilding, Korea Development Bank (KDB). The policy bank is known as a lender of last resort for Korean shipyards; it was the largest shareholder in DSME before it arranged the yard's sale to Hanwha in 2022. In its investment role with HD Hyundai and Cerberus, KDB will "facilitate investments into the Cerberus Maritime strategy" in recognition of the initiative's importance to Korean national objectives.
Cerberus and HD Hyundai have worked together in shipbuilding before. In 2022, Cerberus bought the former Hanjin-owned shipyard in Subic Bay, the biggest yard in the Philippines. Cerberus has leased out part of the space to HD Hyundai, which is investing $550 million at the site and plans to begin building product tankers there by early next year.
Third Training Ship Christened as Backdrop for US-South Korea Shipbuilding
The third U.S. training ship, State of Maine, was christened on Tuesday, August 26, in a ceremony designed to highlight the emerging partnership between the United States and South Korea for shipbuilding. The event was rescheduled a week so that it could coincide with the visit to the United States by South Korean President Lee Jae Myung, and a day after he met with Donald Trump in Washington, D.C.
The South Korean President toured the Philadelphia shipyard that was acquired by Hanwha Ocean for approximately $100 million at the end of 2024. The company’s acquisition pre-dated the Trump initiative to revitalize U.S. shipbuilding and was seen as an entry into the U.S. naval market. The company looks to expand its work for the U.S. Navy and government ships, such as the training ships, and now to leverage the opportunities under the Trump programs. Hanwha aims to produce LNG carriers, naval modules and blocks, and, in the long term, naval vessels at its U.S. shipyard.
Hanwha has committed to a $5 billion program dedicated to the installation of additional docks and quays to increase capacity at the shipyard. It is also reviewing the build-out of a new block assembly facility, and through the expansion, Hanwha aims to increase Philly Shipyard’s annual production volume from less than two vessels to up to 20.
In addition to the infrastructure investment, the U.S. subsidiary of Hanwha’s shipping arm, Hanwha Shipping, announced that it has ordered 10 medium-range (MR) oil and chemical tankers from Hanwha Philly Shipyard, with the first tanker expected to be delivered by early 2029. It previously announced it will buy a Korean-built LNG carrier and complete its outfitting at the U.S. yard to make it the first modern American-flagged LNG carrier built in 50 years.
Elaine Chao doing the honors for the naming (American Maritime Officers)
Lee toured Hanwha Philly Shipyard, joined by officials from the Department of Transportation, the Maritime Administration, and others from the U.S. government, while attending the christening ceremony.
Speaking through a translator, Lee said, "The Republic of Korea's shipbuilding industry is setting out to take on a new challenge to contribute to strengthening U.S. maritime security and rejuvenating America's shipbuilding industry." He highlighted the rapid growth of the country’s industry from “bare ground” to a powerhouse in just 50 years and referred to the “miracle of K-shipbuilding.”
"Through the MASGA (Make American Shipbuilding Great Again) project, we will achieve a 'win-win' outcome that would see the shipbuilding industries of both the United States and South Korea take a leap forward together," Lee highlighted. Yesterday, he promised Trump that South Korea would invest at least $150 billion into U.S. shipbuilding, along with other key industries.
Hanwha Vice Chairman Dong Kwan Kim expressed gratitude to the leaders of both countries and emphasized the importance of joint partnership in bolstering the shipbuilding industry. He said, “Today’s christening ceremony is the physical embodiment of our two nations working side by side to reindustrialize industry, expand our capacity to build ships, and invest in the skilled workforce that will drive the industry forward.”
The third ship of the National Security Multi-Mission Vessel (NSMV) program, State of Maine, is the first purpose-built training ship for the Maine Maritime Academy. At 525 feet in length, it can accommodate 600 cadets for training and, in times of humanitarian need, can handle up to 1,000 people and provide access to an advanced medical facility. The ship, which is due to arrive in Maine later this year, features eight classrooms, an auditorium, and training labs, including a specially-designed training bridge. It has a helicopter pad and is outfitted both to handle containers and roll-on/roll-off cargo to give the cadets hands-on training.
“This vessel marks a new era for American maritime power,” said Acting Maritime Administrator Sang Yi, who represented Transportation Secretary Sean Duffy, who was detained in Washington and did not attend the ceremony. “MARAD’s mission to modernize sealift and empower the Merchant Marine hinges on relentless innovation and partnership. Together, we can build the fleet America needs to secure our future and dominate the seas.”
Elaine Chao, who has held various senior roles in the U.S. government, including Secretary of Transportation in the first Trump administration, was godmother for the vessel. In prior administrations, she served on the Federal Maritime Commission and as Secretary of Labor.
Philly Shipyard had delivered the first two vessels of the class to New York and Massachusetts. Hanwha Ocean is completing the project to build two additional training ships, which MARAD has assigned to the state maritime academies in Texas and California. The yard has also started work on the first of three LNG-fueled containerships for Matson and is completing a rock installation vessel for Great Lakes Dredge & Dock Corporation.
Samsung Heavy Industries Partners with Vigor as Korea Rolls Out MASGA
South Korea’s Samsung Heavy Industries announced a partnership with Oregon-based Vigor Marine Group as part of the companies committing to U.S. investments during the Korean president’s visit to the United States. SHI looks to use the partnership as a way to break into the lucrative repair business for the U.S. Navy and Military Sealift Command (MSC) while also supporting South Korea’s “Make American Shipbuilding Great Again” (MASGA) initiative.
Hanwha Ocean was the first South Korean shipbuilder to win contracts under the U.S.’s maintenance, repair, and overhaul (MRO) program, and recently HD Hyundai Shipbuilding reported it has also won its first MRO contract. It comes as the U.S. looks to expand maintenance capabilities and expedite the projects by keeping the ships forward deployed as opposed to having to wait for limited shipyard space in the United States.
SHI reports it will leverage its expertise and efficiency in shipbuilding while adding a new element to the forward-deployed repair program. By partnering with Vigor Marine, they report the partnership will combine VMG’s deep customer relationships, proven ability to deliver complex projects on time and on budget, and innovative, commercial mindset with SHI’s world-class Korean shipyard facilities, skilled workforce, and advanced technology leadership. Vigor Marine Group will serve as the lead U.S.-based prime contractor.
“We understand the Navy’s evolving needs and have built a track record of delivering results in support of our national defense,” said Francesco Valente, President & CEO of Vigor Marine Group. “Partnering with Samsung allows us to extend that same capability to forward-deployed operations in the Indo-Pacific and potential shipbuilding opportunities here in the U.S. — helping the Navy increase its operational tempo while maintaining the highest quality standards.”
Vigor reports it will continue to develop new ways to perform maintenance and modernization work more efficiently and effectively, while SHI will employ its leadership in automation, digital shipyard technology, and advanced engineering. Together, they promise to introduce new levels of innovation to forward repair operations, streamlining processes, reducing downtime, and enhancing overall fleet readiness.
The deal was one of several announced during a trade meeting during President Lee Jae Myung’s visit to the United States and meeting with Donald Trump. Korean companies committed to a total of $150 billion in investment in areas ranging from shipbuilding to aerospace, semiconductors, batteries, and strategic minerals.
Samsung Heavy Industries and Vigor Marine report they will also explore opportunities to support a U.S. shipbuilding renaissance, including a return to Vigor Marine Group’s shipbuilding roots in the Pacific Northwest. Vigor CEO Valente said investment and implementation of SHI’s advanced technology could support new shipbuilding opportunities in the United States.
Vigor Marine, after being acquired by Carlyle in 2019, has consolidated its operations under a unified brand name with six locations, ranging from the Pacific Northwest to California and Alaska, as well as Virginia. The company has worked to expand its role as a preferred, full-service prime contractor in the defense and maritime sectors, offering advanced services and complete solutions for the U.S. Navy, U.S. Army, Military Sealift Command, state ferry systems, the cruise industry, the commercial fishing industry, and more.
HD Hyundai has also developed partnerships in the United States, including with Edison Chouest Offshore. As part of this week’s trade mission, it also announced an agreement with U.S. private equity giant Cerberus Capital Management and the Korea Development Bank for investments into the U.S. shipbuilding sector. Hanwha Ocean is also planning further investments after buying the Philly Shipyard in 2024 and committing to expanding its operations.
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