The escalating global trade war initiated by the Trump administration is creating unexpected winners and losers in the world's shipbuilding industry. While ports in America face a slowdown, major shipbuilders in South Korea and Japan are reporting surging profits and investor confidence, starkly contrasting with the struggles faced by their Chinese counterparts.
Buoyant Profits Amidst Trade Turbulence
Despite a forecasted 10% drop in imports at the Port of Los Angeles in the latter half of 2025, shipbuilders outside China are thriving. On April 28th, Hanwha Ocean, the world's third-most-valuable standalone shipbuilder, announced a staggering 38% year-on-year increase in quarterly revenue to $2.2 billion. Its operating profit nearly quintupled. The company remains optimistic about demand for its diverse fleet, from container ships to warships.
This optimism is widespread. The combined market value of the world's listed shipbuilders has risen by 15% in 2025, surpassing $200 billion, even as global stock indices dip. Since President Trump's "reciprocal" tariffs announcement on April 2nd, shares of Hanwha and Japan's Mitsubishi Heavy Industries have climbed around 10%. South Korea's HD Hyundai Heavy Industries saw a nearly 40% surge. As JPMorgan Chase's James Sullivan noted, for investors, "there is still time to board."
The Chinese Shipbuilding Engine Loses Steam
In stark contrast, Chinese shipbuilders are facing a perfect storm. The Singapore-listed Yangzijiang, a major Chinese player, has lost a quarter of its market value this year. This reflects a dual threat: new environmental regulations and targeted geopolitical tariffs.
While China now dominates global orders, accounting for two-thirds of existing orders by tonnage according to BIMCO, this lead is under pressure. New emissions standards from the International Maritime Organization (IMO) and the EU, effective from 2027, favour yards with advanced technology for cleaner fuels like methanol. South Korean and Japanese builders retain a significant edge here.
More directly, on April 17th, US Trade Representative Jamieson Greer unveiled new fees on all Chinese-built ships docking at American ports. Initial estimates suggest fees of $2 million per voyage for a large container ship and $3.5 million for a supertanker. For ships owned by Chinese operators, the fee triples. The explicit goal is to curb China's maritime power and stimulate demand for American-built vessels.
Why 'Made in USA' Remains a Distant Dream
The Trump administration's ambition to revitalise American shipbuilding faces immense practical hurdles. The US share of global merchant vessel production has dwindled to a mere 0.1%. The domestic supply chain and skilled labour pool are virtually non-existent. High tariffs on steel increase material costs.
The price disparity is colossal. BIMCO estimates a medium-size tanker built in America costs around $300 million—six times the price of a South Korean equivalent. As the chairman of a large maritime-engineering firm concluded, reshoring shipbuilding is effectively "dead in the water."
Consequently, shipping lines seeking to reduce Chinese exposure are turning to South Korean and Japanese yards, which offer ready capacity, supply chains, and expertise. Even the US Navy may increasingly rely on foreign-built sections or modules from allies like Hanwha and HD Hyundai.
In conclusion, the trade war is forcibly redrawing the map of global shipbuilding. While it has failed to spark an American renaissance, it has decisively shifted momentum back towards established technological leaders in East Asia, leaving China's previously dominant yards navigating increasingly choppy waters.
