I satnd corrected IRT the LNG LPG trade. I am surprised waivers are not granted as a major complaint is waivers are liberally grnated. If there is no US capacity why are waivers not granted. Big issue was the industrial mat laying support OSV industrial vessels in the GOM getting waivers left and right and USCS reviewed and still did not stop the practice.
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Points well taken from all. Forgive my ignorance of the stats and minutiae of this complex issue and no I have not read the draft proposal of the “SHIPS for America Act”.
Think there are two issues and questions for the g-Captain brain trust to chew on:
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The tiny foreign trading deep sea fleet most enrolled in the ACP/ MSP program which are exclusively comprised of reflagged foreign ships, but even those flag-ins would not economically survive without enrollment in the MSP-ACP Tanker security and PL-480 programs, correct? Without those subsidies there would be 0 US presence in global trade. Is this due to a combination of high P+I, liability insurance, operating and wage costs alone or due to antiquated depreciation schedules, taxes and other costs? I have not sailed on one US built ship in the 20+ years of deep sea sailing. I have no MBA, does anyone else have a way forward unless a law is passed that 50% of all US cargo must be carried on US bottoms. Wasn’t Nixon poised to do something along those lines before his impeachment and Ford pocket vetoed it? Now it will never happen, but I think that is a viable and reasonable requirement and involves no subsidies, but is our economist friends would say is still a market distortion. After the founding of the US, there was a build requirement for all registered US ships, coastwise and foreign. But the subsidies now would not increase the foreign trading fleet by even ship, would it? Compared to the comparative cost of US versus foreign ship building in 1980 when the subsidies were repealed by Reagon, the cost differential between US to foreign must be several magnitudes higher. All ships for foreign trade would continue to be foreign flag- in.
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The whole shipyard – Jones Act discussion applies to only coastwise ships for all practical purposes. The problem is the shipyard/ shipbuilding industry has been joined at the hip with the shipping industry since the very beginning of the republic. It probably should have been separated a long time ago. It is probably too late to do that. And yes we would lose the industrial skillsets kept on life support at the present if we did. For all seamen on deep sea bottoms, if the JA disappears, the coastwise crews will be coming offshore and competing for the same jobs.
Waivers are very difficult to obtain. The last JA waivers were issued in 2022 for a tanker to offload diesel in Puerto Rico after Hurricane Fiona and another tanker to transport US LNG molecules to PR from the Dominican Republic (subsequently Congress changed the law to make waivers even more difficult to obtain following pressure from pro-JA groups). Also note that Puerto Rico applied for a 10 year JA waiver in 2018 so they could obtain US LNG and were denied.
This was addressed in a 2011 MARAD report: https://www.maritime.dot.gov/sites/marad.dot.gov/files/docs/resources/3651/comparisonofusandforeignflagoperatingcosts.pdf
After the founding of the US, there was a build requirement for all registered US ships, coastwise and foreign.
True, but it is also worth noting that back then, the US had some of the most competitive shipbuilding in the world (1/3 of the British merchant fleet was US-built at the time of independence).
For all seamen on deep sea bottoms, if the JA disappears, the coastwise crews will be coming offshore and competing for the same jobs.
This is why I have advocated for pairing JA repeal with the expansion of MSP/TSP subsidies to enlarge the fleet (to a size deemed adequate by the Pentagon to meet US sealift needs).
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For what it’s worth the 2012 built tanker, American Phoenix, was built with nearly all US sourced equipment.
The story of it being built is another story.
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51 months from the keel laying to delivery, yikes. As for its equipment, I notice a fair amount of foreign gear:
Not surprising as Britain had to import timber to build merchant ships then. A 1st rate ship of the line for the navy used about 2000 trees mostly of oak and the government reserved forests for this purpose.
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Yep. Big advantage to have access to vast forests not far from the coast at a time of wooden shipbuilding.
The engines are MaK-Caterpillars. Reduction gear - Falk. Main Switchboard, Engine and bridge consoles - L3.
The ship’s construction is a complicated story. The engine room, deck house and cargo control room were built in New Orleans. The forward hull and assembly of the various modules was in Mobile.
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Thanks for the info.
While it is made up of many locally sourced parts, the American Phoenix does feel like it was patched together. I sailed on it as a relief 2nd engineer. Its functional but definitely had that feeling of different parts being put together, like a mismatched puzzle. As you mentioned the story of where it started and how it came to be is pretty complicated.
The Korean kit ship I later sailed on that was assembled at NASSCO had a more put together feel.
As for the build requirement, I’d hate to see it abolished completely, as we’d lose what little large shipbuilding we have left. However, allowing some foreign bottoms would allow companies to add new ships to the fleet. There has to be some sort of middle ground to allow a certain percentage to be foreign built. There are a lot of good ideas floating around in this thread, question is which ones are the most realistic and practical.
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The engine room module construction actually started at Gulf Copper shipyard in Texas. Hurricane Gustav put the entire shipyard underwater. Those bits and pieces ultimately got moved to New Orleans and the project restarted.
https://www.cato.org/people/colin-grabow
Sell Americans out in the name of his globalist corporate masters!!
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What about being able to compete with foreign yards to build MSP ships?
Even ships for domestic trade of a size and type useful for sealift service?
At today’s prices building such ships in allied countries, like Japan or S.Korea, would make more sense than to build them at any US yard. (Get 4 for the price of 1)
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Made by a German company that was acquired by Caterpillar Inc. in 1997:
PS> MAK Caterpillar no longer make medium speed engines:
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Very unfortunate Caterpillar decided to get out of that end of the business. Fairbanks Morse has a license partnership with MAN for medium speed engines. This makes them the only supplier for larger engines built in the US.
Any thoughts on the proposed Strategic Commercial Fleet option/subsidies rather than expanding the existing MSP/TSP structure? Seems like the SHIPs act, if successful, would make economic and NS arguments agains the JA a bit moot?
I worked on one of the last completely Jones Act ships, the Glomar Explorer. Due to the Jones Act they had to install US built engines. The only US built engines for that size ship available at the time were Nordberg which were crap and shortly after they went out of business. Later spare parts were made from a 3rd party who bought the specs on the parts.They were uniformly crap. The US cannot compete with foreign builders in either knowledge, quality or efficiency and has not been able to for a long time. Just look at the cost over runs on military projects. My goodness if I hired a contractor to build a house for a set price and he said it now costs 150% more I would be livid. But in the US the tax payers are clueless. Maybe it’s the education system
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I had a fairly long acquaintance with MaK. They were true to label, reliable and robust. One vessel had 5 as gen sets and smaller vessels with them as main engines. A feeder container vessel had a ME with a shaft generator. She had a service speed of 17 knots and ran 60 reefers without any other machinery running. Most nights the duty engineer had a very quiet night.
I like that it incorporates a bid system, which seems superior to the MSP/TSP approach of simply trying to cover the delta in US vs foreign opex. But a few critiques:
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The bill provides appropriations for FY2025-34. In FY 2034, the appropriation will be $2.1 billion. Divided by 250 ships, that’s $8.4 million per ship. How can you possibly cover the delta in opex and capex (these will be US-built ships) vs foreign ships to compete in international trade with only an $8.4 million subsidy? I don’t understand the math here.
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Given current mariner shortages, how can the commercial fleet be more than 2x’d (current ship number is ~185)? Where will be extra mariners come from? The bill provides money for a public relations campaign to drum up interest in careers at sea, student loan forgiveness, more $$ for state maritime academies (and over $1 billion for KP), and some loosening of licensing requirements, but I’m not sold that will be sufficient. Am I crazy for my skepticism?
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Similarly, US yards — both commercial and Navy — are struggling for workers. So how will all of these new ships be built? Again, is there something I’m missing here?
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Perhaps most importantly, while I’m fine with subsidies to meet national security needs, I think they should be implemented in exchange for reforms/repeal of the JA. This bill doesn’t do anything of the kind. Very little here resembles genuine reform and instead more seems a maritime industry wish list.
If the SHIPS Act was successfully implemented I think it would make the JA itself moot, not the critiques. What is the law’s point if natsec needs are already being met via government subsidies?
Apologies for the lengthy response and for going beyond just a straight answer to your question.
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