I think the delta in wages and regulation accounts has minimal explanatory power for the overall difference in costs/prices. Even US yards don’t seem to think regulation factors very much: https://x.com/cpgrabow/status/1501951910227496972
There is a lot of airlines ahead of United Airlines that I would be less comfortable to fly with. Just shows you how little the public knows.
The reason they are here and Air Bumfukistan isn’t is because of strong regulations that enforce high standards of financial responsibility, management, maintenance, training, and onsite inspection of their facilities and capabilities.
That only gives them landing rights at specific American destinations, it does not allow carriage between American cities.
There is a national security aspect to American flagged airplanes, many of them are in the CRAF.
(The Civil Reserve Air Fleet is part of the United States’s mobility resources. Selected aircraft from U.S. airlines, contractually committed to Civil Reserve Air Fleet, support United States Department of Defense airlift requirements in emergencies when the need for airlift exceeds the capability of available military aircraft)
This is working out about 1,000 times better than the JA as far as providing airplanes and crews without without major subsidies and make-work operations.
Funny, since the Federal Reserve says the following
Federal Subsidies - Air Carriers = $666 million in 2022, $524 million in 2023, $400 million in 2024
Federal Subsidies - Maritime = $8 million in 2022, $19 million in 2023, $5 million in 2024.
If you back up a little further, you’ll see that Air Carrier number balloon to $20 billion in 2020 and $22.1 billion in 2021, while the Maritime category was $58 million in 2020 and $1 million in 2021. Tell me again how the airline industry is 1,000 times better “…without major subsidies and make-work operations…”
Doug
If the end goal of all this is to have plenty of US flagged vessels operated by US citizen mariners then the JA mandate for building in the US really does nothing of value because foreign built ships in the coastwise trades would be just as useful in a national emergency as any which might be built here. Except for coastwise trading vessels the US industry has adopted to use of foreign built tonnage going back decades now.
HOWEVER
If there is a desire to have US based shipyards with the ability to repair battle damaged naval and merchant tonnage in the US during wartime then the US build requirement is of value however that value is quite limited because it will be a very long way to limp damaged ships all the way back to the CONUS from the WestPac (and no war in this century will last long enough that there will be the ability to build new tonnage like in WWII). I would say that repairs to our ships happen using the facilities of our allies. Here I see Japan and the RoK having huge roles as would Singapore. Each has tremendous repair capabilities and would be much closer to the fighting if that fight is centered on preventing the PRC from taking Taiwan which is the most likely fight which we will face in the future.
I don’t want to see US merchant shipbuilding become extinct however if it all comes down to successfully supporting our forces in foreign theaters then the JA US build mandate is counterproductive to that end.
Just my $.02…
I’m aware they can’t fly passengers between US destinations. And my point is that I seriously doubt Americans would strenuously object to them being allowed to operate on domestic routes, particularly given the excellent reputation of many foreign carriers and the fact so many Americans already have experience flying with them.
That is a bit complex to just give a raw number to. Those numbers were COVID payroll loans or grants, not ongoing subsidies and they went to a lot of businesses besides airlines.
Overall since the 1920s the federal government has done a LOT to help the aviation industry. When is was apparent that without licenses and regulations the airliners of the day were crashing far too often to form a viable industry, the CAA (now FAA) was formed. NACA (now NASA) did an enormous amount of research, to this day airplane and boat/ship designers use NACA foil designs. When it was apparent that the airlines just were not going to make any money on their own, the government stepped in with airmail subsidies. Back in the day airline employees sent letters between airports to make sure there was mail on the plane. The whole ATC infrastructure, while partly paid for with fuel and ticket tax, is a form of subsidy just like NOAA and the USCG making charts and putting out buoys.
I could go on with the whole history of regulation, essential air service, etc. etc., but the overall result is a thriving (more or less) industry that has provided the USA currently with about half a million pilots and a quarter million airplanes. This has served us well in time of need and has been vastly more successful then the JA in keeping a vital industry going that is important to national security.
- if you want to relate it to FOC and Class, a US flagged airplane is usually worth more on the market than a 3rd-worldish registered airplane, even if otherwise identical and we have done well to spread high standards to the rest of the 1st world.
Amen
No, it really doesn’t. There is approximately zero overlap between commercial and military construction.
And US shipbuilders continue to be sold out:
Report: Korean Yard to Build US-Flag Tankers
November 6, 2025
Business Korea reports that two tankers built at domestic Korean yard K Shipbuilding will be delivered under the U.S. flag and able to trade within the US.
Construction will begin on the two 50,000dwt medium range tankers early next year for delivery in 2027.
They will transport crude oil and LNG after Greek shipping company Stealthgas transferred the order to its U.S. subsidiary, reports Business Korea, citing sources. Construction will be supervised by ABS.
More companies are expected to follow suit.
https://www.marinelink.com/news/report-korean-yard-build-usflag-tankers-532121
South Korea to Build First U.S.-flagged Oil Tankers - Businesskorea
That build cycle is no shorter than the pace NASSCO constructed the series of Eco tankers for American Petroleum Tankers and Seacor. Same deadweight tonnage. Korean design. Built in San Diego with a 12-14 month keel laying to delivery cadence with the first ship delivering on 04 December 2015 and the eighth ship delivered on 07 June 2017.
Doug
I’d like to see another source on this. That article read a lot like the engine manuals we get from Korea (Korenglish). Maybe they’ll be US flagged from the start (right into the TSP program perhaps?) but I’m doubtful they’ll be eligible for Jones Act trade.
How’s that work?
Could be Congress passed special legislation already to allow these ships JA privileges or I believe the President can waive the rules if deemed in the interest of the nation or these articles got that part of the story wrong and are peddling misinformation.
Time will tell. That may be the only news item for that project, for now, but there’s also this one that has had more publication:
LNG Carrier to be Jointly Built by Hanwha Geoje and Hanwha Philly
[Correction: Initial reports of this order suggested that the vessel would be built at Hanwha Philly. This is incorrect: It will be ordered from the Hanwha Phillly legal entity, then substantially built in Korea by Hanwha Geoje, then sailed to Hanwha Philly for “joint build” production.]
A Hanwha Group subsidiary has purchased a LNG carrier from Hanwha’s shipbuilding subsidiaries, and the U.S. Coast Guard certification work will be performed at the conglomerate’s American shipyard, the recently-acquired Hanwha Philly. The exact scope of work for Hanwha Philly is still under discussion, a spokesperson for the yard said.
That vessel is supposed to meet the US-build requirements coming in 2029 for US LNG export carriers, by building the ship in Korea under a pass-through contract with Philly acting effectively as a broker with minimal physical work-share. We’ll see how that turns out, too.
In the meantime, Fincantieri Bay Shipbuilding has been constructing LNG bunkering barges (2 ATB type at 5500cu.m. capacity for Polaris followed by a 12,000cu.m. capacity non-ATB for Crowley). The last barge is 1/4 the volume capacity of the latest LNG carrier delivered by Hanwha and is a bunkering barge, not an ocean-going LNG carrier, but it shows a growing domestic LNG construction capability.
In that vein, building a ship in Korea under the letterhead of an order from a US subsidiary is a step back in the development of a domestic capability and it’s tough to see where that order structure helps Philly move up from tankers and containerships into the more complex LNG carrier build.
Doug
It will not meet the build requirements for the LNG export mandate, which are even more restrictive than those applied to those operating under the Jones Act.
Fincantieri’s LNG barge for Crowley was delivered last year: Crowley Accepts Delivery of Largest U.S.-Flagged Bunker Barge | Crowley And its barge for Polaris was delivered in 2023.
Are there any other country in the world that has a requirement for vessels under their register to be built at local shipyards?
(Even if the country has cabotage laws that demand domestic trade to be carried on domestic vessels and manned only by national crews)
Back around 1990 the US government looked at global cabotage laws and which countries had domestic build requirements: Summary - Homeland Security Digital Library
They found five other countries: Spain, Indonesia, Brazil, Peru, and Egypt. Pretty sure Brazil and Spain both later removed their build requirements, whilw 1996 MARAD testimony before Congress shed some additional light on the other three:
Is it possible for a shipyard in a high cost country to compete with shipyards in low cost countries like China? (If it still is “low cost” in comparison to say India)
There are examples of that, even for fairly simple vessels.
Japan is NOT a low cost country by any stretch of the imagination, nor have it been for decades. Yet they are still building ship for both domestic and foreign owners.
Large cruise ships are built by yards in several European countries, incl. Finland, Germany, France and Germany for US based operators.
Yards in the Netherlands are still building short sea ships for the European market and specialized vessels for a wider market.
Even shipyards in high cost Scandinavia are competitive for certain types of more sophisticated vessels, although hull sections, or entire hulls, are usually built in lower cost countries, while the national yards do the final outfitting.
Otherwise Scandinavian companies are mostly involved with vessel design, as well as manufacturing of machinery and equipment for the worldwide shipbuilding industry.
Here is an example: Offshore Wind Farm vessels - #394 by ombugge
PS: I don`t know about the other countries mention in the MARAD testimony, but there were lots of foreign built vessels under 5000 DWT operating in Indonesian waters under Indonesian flag and manned by all Indonesians in 1996. (as well as before and after)
Most of those where purchased second hand, so maybe the rule only applied to newbuildings?