![COLUMN | Icebreakers and ICE raids: mixed messages for US shipbuilding renaissance [Offshore Accounts]](http://media.assettype.com/bairdmaritime%2F2025-09-15%2Ffdbrzd0m%2FUntitled.jpeg?w=480&auto=format%2Ccompress&fit=max)
On April 9, US President Donald Trump signed an executive order titled “Restoring America’s Maritime Dominance.” It began with a powerful statement of purpose:
“The commercial shipbuilding capacity and maritime workforce of the United States has been weakened by decades of government neglect, leading to the decline of a once strong industrial base while simultaneously empowering our adversaries and eroding United States national security.
"Both our allies and our strategic competitors produce ships for a fraction of the cost needed in the United States. Recent data show that the United States constructs less than one per cent of commercial ships globally, while the People’s Republic of China is responsible for producing approximately half…”
Within 210 days of the date of the order, the Assistant to the President for National Security Affairs (APNSA) in coordination with the Secretary of State, the Secretary of Defense, the Secretary of Commerce, the Secretary of Labor, the Secretary of Transportation, the Secretary of Homeland Security, the United States Trade Representative, and the heads of whatever executive departments and agencies the APNSA deems appropriate, are supposed to submit a maritime action plan to the President.
I wrote a piece expressing my (surprise) scepticism that shipbuilding can be resuscitated in the land of the free in the short or medium term.
“It is highly unlikely that T-shirt factories and iPhone production are returning to the USA in any meaningful way, even less plausible that more than a handful of expensive, overbudget and probably very late American-built icebreakers will see service in the early 2030s,” I commented.
On July 4, 2025, America's Independence Day, the One Big Beautiful Bill Act was signed into law. This significant US federal statute encompassed various tax and spending policies aligned with the Trump Administration's agenda.
It also earmarked US$4.3 billion to continue construction of the polar security cutter (PSC) fleet of heavy-duty icebreakers for the US Coast Guard. The current PSC programme is delayed with the first domestically built vessel expected to be delivered from Louisiana's Bollinger Shipyards probably in 2030.
There are an additional 21 requests for information outstanding from the US Coast Guard to build icebreakers above and beyond the PSC programme. Neither the three medium-sized icebreakers, proposed under the Arctic security cutter program, nor an additional 18 other domestic icebreakers have made progress to the formal request for proposal stage for bidding, let alone a formal order being placed or steel cutting proceeding.
In June and July, there was a spike of excitement when President Trump was asked about reports that the US would in fact buy icebreakers from Finland, rather than building them in the US.
Finnish yards have a strong track record of building icebreakers both for domestic service and for international clients, including governments. In 2023, Canada's Davie Shipbuilding had bought Helsinki Shipyard, and Finland has a national fleet of icebreakers working to clear winter sea routes in the Baltic.
Some commentators speculated that perhaps the 1993-built Fennica would be bought or leased by the administration to meet the very obvious, short-term gap in American Arctic capabilities.
The acquisition of a second-hand foreign icebreaker would follow on from the purchase of America's only domestically built icebreaker Aiviq (now re-named Storis) from Edison Chouest by the coast guard in December 2024 for US$125 million.
Aiviq had been built to support Shell's cancelled Beaufort Sea and Chukchi Sea drilling operations off Alaska. After some embarrassing operational issues, it was idle for many years when Shell's programme was axed, though it occasionally assisted the Australian Antarctic programme.
From 2015 onwards, several American congressmen advocated that the coast guard should buy the ship. Surprisingly, it later transpired that Edison Chouest was a major donor to at least two of them (see here and follow the footnotes). Note that there is no implication of wrongdoing by Edison Chouest in its campaign contributions to the lawmakers who vocally argued for the sale of the ship to the government.
The American President's own comments on the topic at the NATO summit on June 25, as reported by Peter Rybski in the excellent Arctic Today newsletter, were characteristically garbled enigmatic:
“I want to buy icebreakers. You know, you’re very good at icebreakers. And I actually made him [Finnish President Alexander Stubb] an offer. I didn’t go to Congress. They’ll try and impeach me for this. But there’s an old, it’s not old, it’s fairly new, but it’s a used icebreaker. And I offered him about one third of what he asked for. But we’re negotiating, we need icebreakers in the US, and if we can get some inexpensively I’d like to do that. Actually they’ll fix it up, make it good.
"Also we may buy some icebreakers. You know that you make, you’re the king of icebreakers, that particular country they make them good, they make them really good and they know what they’re doing. And so we’re negotiating with them for about 15 different icebreakers. But one of them is available now it’s old and it’s, you know, old, it’s like five, six years old, and we’re trying to buy it. I’m trying to make a good deal. All I do my whole life, my whole life that’s all I do is make deals.”
Since the flurry of coverage that followed that press conference and reports of discussions with Finnish yards, nothing substantive has emerged, and, so far, nothing has been seen of the final American domestic shipbuilding action plan, but this is not surprising as there are seven weeks to go before the deadline.
If the Americans want icebreakers quickly and at prices far lower than they would pay at home, then Finland or another Western European country would the logical place to build them, in light of endless delays and cost overruns at Bollinger. This idea was first mooted as early as April, as we highlighted, when reports emerged that Rauma Marine Constructions was negotiating with the US Coast Guard over an order for three to five icebreakers at a cost of around €500 million (now US$587 million) per vessel.
Whilst the Finnish shipbuilding order is not yet confirmed, there have been tantalising glimpses of what President Trump's industrial policy document for shipbuilding will recommend, how it will be implemented, and how new obstacles thrown up by the contradictory currents in White House policy will make it harder to achieve the goal of a revival of American shipbuilding.
As you can imagine, I am an avid viewer of Fox News. However, one headline at the start of this month really caught my eye: “Trump admin to send workers abroad to boost US shipbuilding, counter China’s edge.”
This was the traditional framing of shipbuilding by the administration as a competition with China, where America urgently needs to catch up. The banner is attention-grabbing, but the details are distinctly underwhelming.
“While China is massively outpacing the US when it comes to shipbuilding, the Labor Department will announce an US$8 million funding availability Thursday for an international fellowship program that will pair up US institutions with foreign counterparts to remedy this disparity,” Fox reported.
“The four-year proposed project will team up US training centres, registered apprenticeship programs and education institutions like community colleges with foreign training centres, and shipyards in Canada, Finland, Italy, Japan, South Korea and other countries to provide US workers with advanced shipbuilding skills, according to the Labor Department.”
That's eight million US dollars over four years, so two million dollars a year. Assuming each “international fellow” costs US$50,000 per year with wages, accommodation, travel and administration, that will see forty American shipbuilding personnel placed every year for four years, a distinctly underwhelming proposition.
To put that into perspective, at the end of 2024, both Hanwha Ocean, the former Daewoo Shipbuilding in Korea, and its rival Samsung Heavy Industries, each had over 10,000 direct employees working in their shipbuilding divisions, with another 20,000 staff working for each company as partners and contractors in their yards.
This US Labor Department programme is a drop in the ocean and will not move the needle, but without foreign training and support, it is hard to see how the US can catch up.
The skills for high-volume, large-vessel commercial shipbuilding no longer exist in America today, and training even hundreds of skilled welders and fabricators will not close the gap this decade.
The obvious source of the investment required to turn around American shipbuilding would of course be South Korea, the world's number two shipbuilder after China, and a close American ally. Shocked by the threat of high tariffs on its exports to America when President Trump announced his “Liberation Day” import duties in early April, South Korea had been scrambling to make investments in the USA.
This culminated in August, when South Korean companies pledged to invest US$150 billion in America, as per Reuters, across a range of industries, following a meeting between President Trump South Korean President Lee Jae Myung at the White House.
After the meeting, Samsung Heavy Industries said it had signed a strategic partnership with the Oregon-based Vigor Marine Group to cooperate on maintenance, repair and overhaul of US Navy support ships.
The day after the summit in Washington, President Lee visited the Hanwha Philly Shipyard in Pennsylvania, which Hanwha purchased last year for US$100 million, and participated in a christening ceremony for a US Maritime Administration training vessel.
At the same time Hanwha announced a US$5 billion investment in the shipyard, including purchasing two new docks and installing three new quays at the yard. Hanwha’s subsidiary, Hanwha Shipping, also announced the purchase of ten oil and chemical tankers from Hanwha Philly, with delivery of the first vessel scheduled for 2029. This was the largest commercial order at a US yard in twenty years.
In July, Hanwha had announced that it would place an order for an LNG tanker valued at roughly US$252 million, which would be built in Korea and then “fitted out” in Hanwha Philly Shipyard, before being flagged in the United States. This ship is slated for delivery in the first half of 2028, Reuters reported.
South Korean investment ambitions took a major blow this month, however, when the US Department of Homeland Security mounted a massive immigration raid on a US$4.3 billion Hyundai-LG Motor car battery facility under construction in the state of Georgia. Over 300 South Korean nationals were arrested in the immigration enforcement action by masked agents, and publicly chained up, handcuffed and taken to immigration detention centres.
Many of them were on valid business visas at the site to support the commissioning of one of Georgia's largest foreign investments, and the training of American workers. The 475 people arrested in the raid were given the choice of either accepting deportation with a five-year re-entry ban, or stand a months-long trial while remaining in detention in squalid conditions, according to Yonhap.
To say that this issue caused shock and revulsion in South Korea would be an understatement. It took a week for the 316 shocked Koreans to return to South Korea, where they were greeted by cheering and clapping at Seoul-Incheon Airport.
Homeland security officials said the workers arrested at the battery plant were barred from working in the US after overstaying their visas or crossing the border illegally (i.e., they were deemed to be working on business visas, although it is not clear how this was checked in the rush to cuff them and throw them into ICE wagons en masse, and there are specific circumstances where people on B-1 visas could have legally been at the battery factory).
Not surprisingly, South Korea’s President said last week that the ICE raid could have "considerable impact" on direct US investment from his country.
"The US government is two-faced," the Financial Times quoted Chang Sang-sik, Head of Research at the Korea International Trade Association as saying. "It is asking Korea to invest more in the US, while treating Korean workers like criminals even when it [the US] is well aware that they are needed for these projects to happen."
Regardless of the rights and wrongs of people on B-1 visas being at the battery plant (here), the way the immigration raid was conducted has chilled South Korean attitudes to investment in America.
America does not have the skills to build LNG carriers or advanced battery plants without foreign support, and has been very slow to issue full work visas, due to small quotas and a lengthy process. Throwing over three hundred Koreans into detention and deporting them sends a chill across the efforts to obtain foreign expertise to revive American shipbuilding.
South Korea and other investors see how aggressively the foreigners at the Georgia battery plant were treated and wonder whether America really wants their expertise and investment. I myself wonder how America would react if its shipbuilding apprentices were cuffed and tossed into foreign detention centres on visa violations.
The same applies for other defence contracts. We have already read reports that Spain, Switzerland, Canada, Germany and Portugal are reconsidering plans to buy F-35 fighter planes in light of the changes to American foreign and trade policy.
On September 1, Norway announced it had selected the United Kingdom as a strategic partner for the procurement of new Type 26 frigates, which will be primarily manufactured by BAE Systems at its Glasgow shipyards. The Norwegians had considered American options, but eventually opted for a European yard.
“It has been a difficult choice, the four candidates have provided strong and competitive proposals – they are all close allies…the extensive cooperation on security and defence policy will continue at full strength with all of them,” Norwegian Prime Minister Jonas Gahr Støre said in the local press.
The first ship in the programme is scheduled for delivery in 2030. The Royal Norwegian Navy will equip the frigates with anti-submarine-capable helicopters, but the selection of the supplier for the helicopters has not been made.
Conclusion: if you need foreign help, best to be nice to them. Investors don't have any obligation to support the small and backward American shipbuilding industry. Customers don't have any obligation to buy American ships or planes.
American shipbuilding is best revived as part of a holistic policy, which respects foreign investors and foreign technical expertise.
Background reading
Fox News' chief national security correspondent Jennifer Griffin has a report on the latest ship launched by China and expresses concern about where America stands in what the station describes as the “shipbuilding battle” with China. Since Ms Griffin is a possible contender to replace Pete Hegseth as Secretary of Defense in future, her views matter.
Breaking Defense has an overview of the American icebreaking shortfall here.
