Outdated Jones Act Leaves U.S. Shipbuilding Stagnant While rivals Build Thousands

American shipbuilding is limited to 15 cargo vessels under construction, a stark contrast to the 4,000-plus ships being built in China and the 750 in South Korea. Critics attribute this disparity to the Jones Act, a 1916 statute that requires goods moving between U.S. ports to travel on American-built and -owned vessels. Over a hundred years of protectionism, they say, has eroded the domestic industry, leaving only 92 eligible ships capable of carrying commercial cargo.

Four shipyards—General Dynamics NASSCO, Hanwha Philly Shipyard, Seatrium AmFELS, and the former VT Halter Marine—are the sole producers of large vessels, each limited to four or five ships a year. The act drives daily operating costs of domestic tankers to $86,000-$91,000, far above the $9,000 for comparable foreign ships, and makes freight to places like Puerto Rico and Hawaii six times more expensive per ton-mile. Consequently, waterborne transport accounts for just 3.9% of U.S. freight, versus 28% in the EU, raising concerns about economic efficiency and national-security readiness.