United States President Franklin D. Roosevelt told a national radio audience on December 29, 1940, that the U.S. must come to the aid of a Great Britain under siege from Adolf Hitler’s bombers and become the “great arsenal of democracy.” A little less than a year later, the U.S. would be at war, and its industry — mobilized from commercial to military production — would become that arsenal.
Now, the U.S. is again taking decisive action to expand its defense industrial base (DIB), develop advanced weapons systems and confront global challenges that threaten a stable and open international system, including Russia’s ongoing war in Ukraine and an increasingly confrontational Chinese Communist Party (CCP) in the Indo-Pacific.
With executive orders issued in April 2025, U.S. President Donald Trump directed the government to accelerate the pace of military procurement and boost the DIB, as well as make it a priority to restore the nation’s maritime dominance and streamline foreign defense sales. The orders came in the wake of a March 2025 speech in which President Trump announced the creation of an Office of Shipbuilding within the White House. His remarks made clear that maritime production is crucial to the revitalization of the DIB. “We are … going to resurrect the American shipbuilding industry,” he said, “including commercial shipbuilding and military shipbuilding.”
The U.S. government also has proposed a $1 trillion defense budget for fiscal year 2026. Its priorities include the funding of the proposed Golden Dome for America air defense system, nuclear enterprise modernization and building more ships and nuclear submarines.
U.S. Air Force Gen. Anthony Cotton, Commander of U.S. Strategic Command (USSTRATCOM), said a robust DIB is essential to modernizing and maintaining the U.S. nuclear triad of land-based intercontinental ballistic missiles, strategic bombers and nuclear-armed submarines. The Columbia-class ballistic missile submarine (SSBN) program is a modernization priority for USSTRATCOM and the U.S. Navy. The Navy plans to replace the current Ohio-class submarines with 12 Columbia-class boats. The SSBN fleet is the most survivable leg of the triad.
Gen. Cotton has advocated for raising the base production of the B-21 Raider strategic bomber, upgrading the existing B-52 fleet and maintaining availability of existing Ohio-class submarines while production of its Columbia-class replacements gets up to speed.
“A healthy industrial base that can provide advanced technology, capability and capacity on time is fundamental to our ability to compete strategically,” he told the U.S. Senate Armed Services Committee in March 2025.
One example of the administration’s focus on a healthy DIB came in July 2025 when Aerojet Rocketdyne opened a new and expansive rocket propulsion plant in the U.S. state of Alabama. “When you hear senior leaders across the nation talking about increasing capacity, increasing throughput, increasing missile and munition inventory levels; when you hear people talking about getting on a war footing, understanding the threats and the adversaries that we face on a daily basis; when we talk about all of these things, this is the manifestation of that outcome,” U.S. Army Maj. Gen. Frank Lozano, the U.S. Army’s program executive officer for missiles and space, said at an opening ceremony for the facility, according to DefenseNews.
Experts say the U.S. also can address the DIB through steps such as those outlined in President Trump’s executive orders, as well as through manufacturing and technology collaborations with Allies such as Japan and South Korea.
Beijing’s expansion
China’s current defense industrial production indicates that the CCP is on a “wartime footing,” according to Seth Jones of the Center for Strategic and International Studies and co-author of the 2024 report Rebuilding the Arsenal of Democracy.
“That doesn’t mean war is imminent, per se, but what it means is they are building the capabilities to conduct a war, and a war in particular with the United States,” Jones said on a March 2024 episode of “The Truth of the Matter” podcast.
The U.S. Navy, according to a January 2025 report by the Congressional Budget Office (CBO), has 295 battle-force ships but seeks to increase its fleet to 390 by 2054. However, the CBO notes that the fleet will shrink first because of planned ship retirements that will drop its size to 283 in 2027. The Defense One news website reported in March 2025 that the U.S. has a “significant backlog” in the production of warships and nuclear submarines. Only four public shipyards in the country maintain Navy ships, according to a February 2024 story by the U.S. Naval Institute. (The Navy had 11 public shipyards at the end of World War II.)
A May 2025 commentary by analysts Miyeon Oh and Michael Cecire at the Rand Corp. think tank offered further context for the U.S. executive orders: China accounts for about 50% of the world’s output of commercial vessels, with South Korea second (30%) and Japan third (10%). “The United States, meanwhile, accounts for less than 1% of the global shipbuilding market,” the analysts said. U.S. Navy Secretary John Phelan, during his Senate confirmation hearings, said of that imbalance: “The president has been very consistent when he spoke with me: shipbuilding, shipbuilding, shipbuilding.”
To address that challenge, the Restoring America’s Maritime Dominance executive order includes:
- A whole-of-government strategy to rebuild U.S. shipbuilding and maritime infrastructure.
- Financial incentives to boost private investment in U.S. shipyards.
- Expansion of shipbuilding capabilities and parts supply chains.
- Greater investment in workforce training to recruit and retain skilled maritime professionals.
Defense analysts say a pragmatic approach will help accomplish such goals. A May 2025 report from the Atlantic Council cautioned against the tendency to “exaggerate or overstate” the Chinese maritime threat. The report noted that the U.S. Navy still holds the advantage in several areas — such as vertical missile launchers, destroyers, nuclear aircraft carriers and nuclear attack submarines. “Within range of its land-based missile systems, China is a dangerous opponent. In blue water, the United States and its Allies are far more capable,” wrote Richard Hooker Jr., author of the report. Smaller coastal patrol ships make up much of the People’s Liberation Army Navy (PLAN) fleet, according to the report. The World Directory of Modern Warships and Submarines, while noting PLAN’s numerical edge, ranked the U.S. first in its “TrueValueRating,” which uses metrics such as “modernization, logistical support, and attack and defense capabilities.”
Still, as Phelan told a U.S. House defense subcommittee in May 2025: “We need to get hulls in the water.”
Allies and Partners
If the U.S. is to launch those hulls, then Allies and partners will play integral roles, whether through shipbuilding expertise, shared research and development (R&D), or tech collaborations. Analysts say that working with Japan and South Korea on shipbuilding makes sense because the U.S. needs to be able to produce ships more quickly — for both military and commercial purposes.
The Rand think tank, in a May 2025 commentary, said that South Korean shipyards, including Hyundai Heavy Industries (HHI) and Hanwha Ocean, possess “efficient mass production techniques that allow for the rapid delivery of high-quality warships, with expertise in modular construction and advanced ship design. In 2024, for example, HHI delivered the Aegis destroyer Jeongjo the Great to the Republic of Korea (ROK) Navy. The Wall Street Journal newspaper, in a video report on HHI’s shipyard in Ulsan, put the cost of building the warship at $600 million, which it said is a billion dollars less than what the vessel would cost if built in the U.S. The ROK destroyer was built in 18 months at Ulsan, which is the world’s largest shipyard, according to the Journal. In the U.S., it would have taken 28 months to build the vessel, the report said. U.S. law, however, prevents the Navy from buying ships or building “major component[s] of the hull or superstructure” for them from a “foreign shipyard.”
Phelan visited Japan and South Korea, toured their shipyards, and met with defense officials and maritime industry leaders on an Indo-Pacific trip in late April 2025. He told the news magazine Nikkei Asia ahead of his trip that cooperation with Allies is essential. “We aim to revive the U.S. shipbuilding industry by joining forces with [South] Korea, ranked second globally [in ship production], and Japan, ranked third,” Phelan told Nikkei Asia. During his trip, Phelan also called for deeper cooperation with South Korea in naval ship maintenance, repair and overhaul (MRO), encouraging their shipyards to bid on more overhauls of U.S. Navy ships. “South Korean shipyards are conducting [MRO] of U.S. Navy ships in South Korea, and have invested in American shipyards,” he told the Yonhap News Agency. “I am extremely impressed with South Korea’s shipbuilding capabilities, and my visits to HD Hyundai Heavy Industries and Hanwha Ocean shipyards have only served to reinforce this.”
Huntington Ingalls Industries, the largest U.S. naval shipbuilder, reached an agreement in April 2025 to partner with HHI on accelerating ship production in support of defense and commercial projects. Hanwha Ocean, which already has a portfolio of U.S. Navy-related projects, acquired Philly Shipyard in Philadelphia in 2024. “In order to remain the world’s dominant maritime power, we must increase capacity to both build new ships and conduct maintenance,” Phelan said. “It is my hope that shipyards in South Korea will play a crucial role in helping revitalize America’s maritime industrial base through foreign direct investment and sharing best practices.”
The Japanese shipyards, such as Mitsubishi Heavy Industries, also have “world-class expertise in naval engineering and systems integration, which allow them to build some of the most advanced destroyers and submarines in the world,” according to Rand. In the first stop on his trip, Phelan toured Japan Marine United’s Isogo Works shipyard and met with then-Defense Minister Gen Nakatani, according to the Stars and Stripes newspaper. Phelan encouraged Japanese officials to consider investing in U.S.-based joint ventures, pointing to Hanwha Ocean’s acquisition of the Philadelphia shipyard as an example, Stars and Stripes reported.
Shipbuilding collaborations could also extend to uncrewed vessels. Joshua Tallis, a principal research scientist at the Center for Naval Analyses, wrote in an April 2025 commentary for DefenseNews that pairing U.S. startups in defense tech with Allies could enable the mass production of autonomous vehicles across all domains. “Much like an iPhone says on the back, ‘Designed by Apple in California, Assembled in China,’ it is possible to envision a[n] … unmanned surface vessel with the stamp: ‘Designed in Texas, Assembled in Yokohama,’” Tallis wrote.
AUKUS
Australia, the United Kingdom and the U.S. created a security partnership in 2021 known as AUKUS, which seeks to boost the submarine industrial base (SIB) of the three nations as well as commit to a “peaceful, secure and stable” Indo-Pacific region. The U.S. Department of War (DOW) is currently reviewing the agreement.
Pete Hegseth, the U.S. Secretary of War, said during talks with Australian Defense Minister Richard Marles at the Pentagon in February 2025 that AUKUS “has to be [supported by] robust Allies and partners. Technology sharing and subs are a huge part of it,” according to the DOW. Still, in a July 2025 social media post, the DOW announced a Hegseth-directed review of the initiative. “As part of this process, the [DOW] looks forward to continuing regular engagements on this important matter with other parts of the U.S. government, the U.S. Congress, our Allies Australia and the United Kingdom, and other key stakeholders. The department anticipates completing the review in [late 2025]. Its purpose will be to provide [President Trump] and his senior leadership team with a fact-based rigorous assessment of the initiative.”
The initial AUKUS goals, according to the DOW, included fostering “deeper integration of security and defense-related science, technology, industrial bases and supply chains.” The first AUKUS initiative, Pillar 1, is a commitment to support Australia in acquiring nuclear-powered submarines. In 2023, a deal was reached for Australia to buy at least three U.S.-built Virginia-class attack submarines within 10 to 15 years. The plan also calls for a new generation of subs, SSN-AUKUS, to eventually be built in Australia with British and U.S. help.
In May 2025, Hegseth and Marles met during a security forum in Singapore, where they discussed the need to significantly lift U.S. submarine production rates to meet AUKUS targets, Reuters reported. In July 2025, Australia made a second payment ($525 million) to the U.S. under an AUKUS deal in which Canberra pays $3 billion to boost the capacity of the shipyards that build U.S. submarines, according to Reuters. The investment also includes funds for U.S. workers to help Australia establish its own SIB and for Australians to work in U.S. shipyards.
Marles, in a statement after Australia made its initial payment of $500 million in February 2025, said the investment is about his country “paying its way when it comes to AUKUS by helping to uplift the U.S. SIB so that Virginia-class submarines are available to be [built and] transferred to Australia.” The submarine deal could cost Australia up to $368 billion over the next three decades, according to the Australian Broadcasting Corp.
Meganne Atkins, executive director of the U.S. Navy AUKUS Integration and Acquisition (I&A) program office, discussed the partnership’s strategy at the Naval Submarine League’s Annual Symposium and Industry Update in November 2024. It’s a “rising tides lift all boats mentality on our industrial base, so that we have multiple organizations that are able to support multiple classes of submarines across the entire AUKUS, from our U.S. Virginia class to our Australian Virginia class to our SSN-AUKUS in the future,” she said, according to National Defense magazine.
In March 2025, U.S. multinational corporation Honeywell announced that it had won a contract awarded by the nonprofit BlueForge Alliance on behalf of AUKUS I&A to set up a pilot program through which Australian companies can support the production, sustainment and operational readiness of Virginia-class submarines, according to Australian Defence Magazine. BlueForge Alliance is one of the DOW’s “unconventional efforts to use third parties to kick the nation’s submarine-building industry into a higher gear,” according to a September 2024 report by Defense News.
Analysts say that AUKUS partners can ease U.S. submarine production pressures through shared R&D, training and supply chain investment.
U.S. Navy Adm. Bill Houston, who directs the U.S. Navy’s Nuclear Propulsion Program, said AUKUS will help the submarine building of the U.S. as well as those of Australia and the U.K. “Those Allies and partners, they are bringing capabilities to us,” he said at the symposium, according to National Defense magazine. Houston said that commonality is key to AUKUS, because developments born in isolation among the three Allies are hugely expensive and time-consuming, according to National Defense magazine. (Commonality also extends to personnel. In April 2025, the first enlisted Sailors from the Royal Australian Navy graduated from the U.S. Navy’s Nuclear Power Training Unit.) “The United States has done low-rate production in the past, Houston said, according to the magazine, “but we need to now capitalize on international, large, broad capabilities, which are common on all platforms.”
Eric Lies, writing in online journal The National Interest, said that “integrating the three AUKUS countries’ military-industrial complexes and collaborating on research and development will improve the economic opportunities available to the United States.” Lies said demand for U.S. expertise in submarine construction will last for decades under Pillar 1, but that the wide-ranging research and development shared under Pillar 2 will include, for example, artificial intelligence, autonomous vehicles and hypersonic missiles. In addition, both Japan and South Korea have been consulted on areas of collaboration under Pillar 2, according to The National Interest.
Build on advantages
The revitalization of the U.S. defense industrial base — especially its maritime industry — will require action across the government, military and private sector. “Rebuilding our hollowed-out maritime industrial base is a national security imperative,” Phelan, the Navy secretary, told U.S. lawmakers in May 2025. As Phelan and the executive orders make clear, the cooperation and partnerships with Allies must be factored into any solution. Tallis, of the Center for Naval Analyses, said the U.S. — much as the maritime executive order lays out — needs to build on its competitive advantages as well as the power of its alliances. “What we lack in an industrial maritime footprint,” he wrote in DefenseNews, “we make up for in innovation, capital markets and financial services.”
A Few of the Other 2025 Defense Executive Orders:
Modernizing Defense Acquisitions and Spurring Innovation in the Defense Industrial Base states that the U.S. “must deliver state‐of‐the‐art capabilities at speed and scale through a comprehensive overhaul of this system.” It prioritizes “speed, flexibility and innovation” in acquisitions while seeking to “incentivize and reward risk-taking and innovation” from the defense acquisition workforce.
Reforming Foreign Defense Sales to Improve Speed and Accountability seeks to reduce regulatory burdens and foster collaboration between government and industry. The order says that reforming the system will strengthen U.S. Allies’ capabilities and “allied burden-sharing” while boosting U.S. supply chains, production and technology development. It also calls for the granting of “simultaneous certifications and approvals” to speed sales.