In his second term, one of President Trump’s signature infrastructure priorities has been the revitalization of the American shipbuilding industry. In April of last year, he released Executive Order 14269, “Restoring America’s Maritime Dominance,” which set forth a policy that the U.S. must “revitalize and rebuild domestic maritime industries and workforce to promote national security and economic prosperity” and called for the development of a Maritime Action Plan (MAP).

That MAP was released on February 13^th, and provides approximately 30 pages of recommendations aligned with the E.O.’s policy goal. However, the MAP is light on specifics about which recommendations will require Congressional action, which agencies are responsible for implementing the policy recommendations, and the timelines for their following through on the recommendations. The most impactful changes will certainly require Congressional action, but while the E.O. directed agencies to include legislative proposals in the MAP itself, the MAP describes several legislative proposals only in broad terms.  Instead, the plan defers all specifics to a package of legislative proposals still being developed, to be transmitted “following publication of the FY2027 President’s Budget Request.”

The MAP sets forth four “pillars” of actions that will help to expand the shipbuilding and maritime industry in the U.S.: rebuilding U.S. shipbuilding capacity and capabilities; reforming workforce education and training; protecting the maritime industrial base; and a fourth pillar focused on national security, economic security and industrial resilience.

The MAP’s proposals for rebuilding capacity focus on investments in commercial shipyards, although here and elsewhere the recommendations are offered without indicating an entity with responsibility for action, leaving it unclear whether the Administration will ask Congress to expand federal funding for such investments. In a discussion of incentives for investment in shipbuilding, the MAP mentions exemptions for tax liabilities, grants, and loans, and also notes that “the primary vehicle for these incentives is the creation of bilateral or multi-lateral PPP, which are typically managed by State-level government agencies, local-level jurisdictions, and utility service providers.” The MAP recommends ensuring “long-term funding” through the Maritime Administration’s (MARAD’s) Federal Ship Financing Program (e.g. the Title XI loan program) but does not explicitly call for any change or increase to funding for the program. Rather the MAP suggests that MARAD reduce application processing time and remove burdensome program. According to the MARAD website, the Title XI currently has approximately $136 million in credit subsidy available, which could support approximately $1.8 billion in new loan approvals.

Another notable proposal for shipbuilding investment in the MAP is a new “Maritime Prosperity Zone” proposal modeled on the 2017 Opportunity Zones. Through such a program, investors would presumably see tax benefits for investing capital in areas designated as a Maritime Prosperity Zone.

Some of the more significant proposals are included as part of the pillar on protection for the maritime industrial base. As part of this section, the Administration proposes to level the playing field between land ports and sea ports through the creation of a Harbor Maintenance Fee equivalent for land borders. The MAP proposes a “modest tax” equal to 0.125 percent of the total value of the merchandise entering the land port of entry. The creation of this Land Port Maintenance Fee is proposed to both remove the disincentive for maritime ports and create a dedicated funding source for improvements to land ports of entry. According to the Bureau of Transportation Statistics, 14 of the 50 largest trade gateways are land ports of entry, the largest of which are Laredo TX and the Michigan ports of Detroit and Port Huron. In 2024, across all 14 of the largest land ports, 636.6 billion worth of goods was imported, so a 0.125 percent tax would raise approximately $800 million, up to 10 percent of which, per the MAP, would be allocated to administrative expenses.

The other major fee proposed in the MAP is a “Universal Fee on Foreign-Built Vessels” assessed on the weight of the imported tonnage, to be used for a new Maritime Security Trust Fund. The MAP doesn’t propose a rate for this fee, but notes that a fee of 1 cent per kilogram could raise $66 billion over ten years, while a 24 cent fee could raise close to $1.5 trillion. The proposed Maritime Security Trust Fund would be used to promote, grow, and strengthen the maritime sector.

This proposal differs from the U.S. Trade Representative port fees that were briefly imposed in October of last year but were suspended by the USTR for a one year period starting in November. The USTR port fees were also aimed at protecting U.S. shipbuilding, but applied only to Chinese-built and Chinese-owned vessels calling at designated U.S. ports. In comparison, the new proposed universal fee would cover all non-domestic built vessels calling on US ports, which would therefore impact the vast majority of ships since Jones Act ships operate mainly on domestic trades. While both fees are designed on weight rather than value, the USTR fees were calculated on net tonnage of the vessel whereas the new proposed charges would be based on import cargo weight alone.

In a statement, the International Chamber of Shipping, a trade group that represents shipowners and operators, noted that they remain “opposed to any proposed port fees, including the suggested universal infrastructure or security fee on foreign-built commercial vessels calling at US ports.” Describing the proposed fees “a substantial additional cost burden on maritime transport,” the trade group warned of the potential risks for “distorting trade, increasing costs for US consumers and businesses, disrupting the smooth flow of global commerce, and could encourage retaliatory measures.” It is probable that shippers would ultimately pass much of the costs imposed by a port fee on to US consumers. According to the Yale Budget Lab, the cost of tariffs imposed on imports have been passed on to consumers at estimated rates that range from 31–63% for core goods (e.g. food and clothing) and 42–96% for durables (e.g. long-lasting goods such as cars, appliances, and furniture).

In addition to the legislative proposals broadly described but still to be transmitted, the MAP also argues that deregulation and streamlining are necessary to “ensure U.S.-flagged vessel operators are not burdened with unnecessary regulatory requirements that place them at a disadvantage compared to foreign competitors.” The MAP includes a list of regulations that may be “redundant, obsolete, or unduly burdensome” including data collection and reporting requirements as well as inspections and certification requirements,  and proposes to adjust the EPA’s Engine International Air Pollution Prevention Certificate requirements.

The MAP sets out ambitious goals regarding shipbuilding (though much depends on Congressional action on the legislative proposal to be released at a future date). However, while the Administration acknowledges the current challenges facing shipbuilding in the U.S., the MAP does not engage earnestly the historical and structural challenges facing U.S. shipbuilding. The MAP notes that less than one percent of new commercial ships built in the country and only 66 total shipyards nationwide, but call that a matter of “recent data” and describes an effort to “restore” shipbuilding. In fact, U.S. commercial shipbuilding has been uncompetitive with other countries for more than a century, outside of brief war-time efforts to build up capacity that was not maintained in peacetime.

While North America was the shipbuilder in the 19^th century when plentiful low-cost wood was the primary input cost for ships, the U.S. has never been competitive with international shipbuilders since the industry transitioned to iron and steel ships. The shipbuilding industries in Japan and Korea benefited from their lower costs of steel in the 1970s and 80s, and today the lower input costs including both steel and labor costs have enabled China to become the dominant shipbuilder internationally. In 2024, China held 67 percent of the market share for commercial shipbuilding, growing at the expense of Korea and Japan, which feel to 17 and 11 percent respectively. The rest of the world including Europe produces less than 5 percent of commercial ships. One reason that the U.S. has struggled to compete in shipbuilding, according to Brian Potter, is that the U.S. has historically pursued an isolationist approach “focused on sheltering the industry from competition rather than driving to make it successful.” In this regard, the MAP approach does not differ significantly from prior policies regarding U.S. shipbuilding.