Navy plan allows overseas shipbuilding if needed

May 12, 2026

Summary

A new Navy shipbuilding plan said allied shipyards could supplement U.S. production if domestic builders cannot meet timelines.

Why this matters

The plan shows how the Navy may balance domestic shipbuilding goals with production deadlines as it seeks a much larger fleet. It also signals potential changes in where some support ships and ship components could be built.

The U.S. Navy’s fiscal 2027 shipbuilding plan, released Monday, said the service could turn to allied and partner nations to supplement domestic shipbuilding if U.S. industry cannot meet deadlines.

“Building and maintaining ships in America is central to the president’s vision and strengthens the nation’s industrial base,” the budget document said. “While American shipbuilding remains the priority, the Navy will evaluate overseas options and whether allied and partner shipbuilding can supplement domestic production if U.S. industry cannot meet required timelines.”

The plan followed comments in April from then-Navy Secretary John Phelan, who told reporters at the Navy League’s Sea-Air-Space symposium that the Navy would study building warships outside the United States, citing U.S. labor shortages. He was fired one day later, with the Trump administration citing a need for a leadership change.

Subsequent reports said disagreement between President Donald Trump and Phelan over building Navy battleships abroad contributed to tensions. Hunter Stires, a maritime strategist for former Navy Secretary Carlos Del Toro, said Phelan’s remarks undercut the administration’s message about rebuilding the U.S. maritime industrial base through domestic investment.

The fiscal 2027 plan said the Navy could use overseas shipyards for auxiliary vessels, including tankers that supply fuel and ammunition to combat ships. The Navy proposed $450 million in fiscal 2027 for one consolidated cargo replenishment at sea tanker, a commercial tanker chartered by Military Sealift Command to refuel Navy ships underway.

It also planned to spend $2.3 billion over five years to buy five fuel-support tankers built “potentially” and “initially” at overseas shipyards. The Navy asked Congress to approve construction of two auxiliary ships and “the flexibility for fabrication of some combatant modules overseas,” according to the plan.

The budget also differed from another Phelan comment at Sea-Air-Space. The Navy said Golden Fleet-era battleships would be nuclear-powered, after Phelan had said nuclear power aboard the future vessels was “unlikely.”

The service also said it wanted to raise use of distributed shipbuilding sites from 10% to 50%. Trump’s proposed $1.5 trillion fiscal 2027 defense budget included $65.8 billion for shipbuilding, including 34 manned ships and five unmanned platforms.

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