Trump's promise
In a recent address, Trump signed a bold executive order aimed squarely at reviving American shipbuilding. Central to this strategy is the establishment of an Office of Shipbuilding in the White House, tasked with streamlining policy, cutting red tape, and revitalizing domestic maritime production. Special tax incentives will also be offered.
"We are also going to resurrect the American shipbuilding industry, including commercial shipbuilding and military shipbuilding," Trump said during his recent address to Congress. “We used to make so many ships. We don’t make them anymore very much, but we’re going to make them very fast, very soon, it will have a huge impact.”
Adding teeth to this ambitious strategy, the U.S. Trade Representative (USTR) has proposed steep penalties – up to $1.5 million per vessel – on Chinese-built ships docking at American ports. Any shipping firm with at least one order on the books for a vessel made in China would also have to pay a fee. These fees would apply to 90% of the world’s vessels, according to the World Shipping Council.
The message is clear: Trump intends to challenge China's maritime dominance head-on, part of a larger conflict centered on trade.
Various carriers, industries and trade associations are currently opposing this proposal, according to CNBC. Skeptics of Trump’s plan suggest the available labor pool can’t address today’s demand – nevermind a new wave of building meant to counter China’s dominance. “We’re trying to get blood from a turnip,” Government Accountability Office analyst Shelby Oakley told ProPublica. “The domestic workforce is just not there.”
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Learn MoreInvestors eye a key stock
Investors, sensing the shift in tides, are eyeing one company in particular as a way to seize on the renewed focus on shipbuilding: Huntington Ingalls Industries (HII)
The Virginia-based shipbuilder is America's largest military shipbuilding firm, renowned for constructing nuclear-powered aircraft carriers, submarines, and amphibious assault ships. HII is uniquely positioned to capitalize on Trump's new maritime initiative.
Following Trump's announcement, Huntington Ingalls Industries, which reported $11.5 billion in revenue in 2024, saw its stock surge significantly.
Investors have poured into HII, betting the company stands to gain tremendously from Trump’s shipbuilding push. HII stock is up almost 20% in the last month, reflecting growing investor enthusiasm and confidence in the company’s prospects.
But challenges still loom large on the horizon.
Analysts caution that while Trump's tariffs on Chinese vessels might seem like a decisive strike against foreign competition, they could inadvertently drive up shipping costs, impacting consumers through higher prices and potentially escalating trade tensions.
Meanwhile, rebuilding America's shipyards and skilled workforce will require substantial, sustained investment beyond short-term policy shifts.
Despite these concerns, Trump remains bullish, and investors appear convinced that a revival is possible. Huntington Ingalls Industries stands ready to ride this wave of optimism and strategic backing.
Whether or not Trump’s ambitious vision for American shipbuilding ultimately succeeds remains uncertain. Yet, there’s renewed enthusiasm for the U.S. maritime industry – enough to spark investor enthusiasm and potentially shift the balance of maritime power back toward American shores.
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