President Trump has ordered the Pentagon to open American warship construction to foreign shipbuilders under a model that would allow the first two ships of a class to be built abroad, provided the builder establishes or buys a shipyard in the United States and builds everything after that on American soil, according to a presidential memorandum issued on 13 August.
The memorandum also directs the Secretary of War to produce a plan to strip the Electromagnetic Aircraft Launch System and the Advanced Weapons Elevators out of the aircraft carrier CVN-81 and replace them with steam catapults and hydraulic elevators, reverting to the arrangement used on the previous generation of carriers.
Addressed to the Secretary of War, the Director of the Office of Management and Budget and the National Security Adviser, the document states that the Navy “has experienced a series of shipbuilding setbacks stemming from overly complex designs and iterative design change procedures, which have resulted in cost growth, delays, and cancellations.” It says a lack of capacity and competition among shipbuilders has produced large backlogs across six major programmes and a commercial sector that is not globally competitive.
The Finland Model
The mechanism for bringing in foreign builders is described in the memorandum as the Finland Model, taking as its template a memorandum of understanding signed with Finland in October 2025 covering medium icebreaker construction. It can be applied to up to three ship classes.
Under the conditions set out, a foreign supplier must simultaneously build a new American shipyard or take ownership or a majority equity position in an existing one, and build all ships after the first two in the United States. It must hire and train an American workforce, license the proprietary shipbuilding techniques and technologies used at the parent yard to the American yards, and source an American supply chain for construction and maintenance.
Building warships in foreign yards is generally prohibited under United States law. The memorandum delegates to the Secretary of War the authority to make the national security determination that a contract qualifies for a waiver and to notify Congress of each determination, with no contract permitted until 30 days after Congress receives it.
A new frigate competition
Within 90 days the Secretary of War is to submit a plan for what the memorandum calls “a new competitive acquisition approach for surface combatants with sufficient inherent capabilities to perform anti-submarine warfare, surface warfare, and convoy escort duties”, explicitly allowing proposals based on the international procurement model.
That description covers the ground occupied by the British Type 26 and Type 31, both of which are already exported. BAE Systems has sold the Type 26 design to Australia, Canada and Norway, the last in a £10 billion deal signed in 2025, while Babcock’s Arrowhead 140, the parent design for the Type 31, has been selected by Poland and Indonesia. Both are mature designs in production, which is what the memorandum says it wants.
The insistence on design stability runs through the document. It states that the Navy “shall not impose iterative design changes upon the original mature parent designs” within the programmes concerned, and that no changes may be made without the approval of the Secretary of War in consultation with the Navy Secretary, OMB and the National Security Adviser.
The target of that instruction is not named, but the Constellation-class frigate offers the obvious precedent. Derived from the Italian FREMM design and intended as a low-risk buy of a proven ship, it accumulated so many American modifications that commonality with the parent design fell away, and the programme ran years late amid heavy criticism from the Government Accountability Office.
Yards and repair capacity
Within 120 days the department is to submit a plan to increase nuclear submarine and carrier readiness, including the establishment of a fifth public Navy yard. The United States currently operates four, at Portsmouth in Maine, Norfolk, Puget Sound and Pearl Harbor.
The plan is to address drydock capacity for the planned growth of the attack submarine fleet over the next two decades, with locations proximate to the Pacific Fleet including the continental United States, Alaska, Hawaii and American territories, and site options covering up to three new drydocks sized for every current and projected class of submarine. Public-private partnerships are named as a possible financing route.
A separate plan, due within 90 days, covers a Component Repair Center to receive new parts and refurbish old ones for the submarine repair industrial base, holding at least one ship set of spare equipment for the Los Angeles, Virginia, Seawolf, Ohio and Columbia classes.
Naval Sea Systems Command is also to be reviewed within 120 days, with recommendations for personnel, organisational and structural reform. The stated objectives include introducing results-based accountability for NAVSEA leadership measured by speed of delivery, reducing bureaucracy, eliminating competing priorities within the command, and preventing it from imposing redesigns on mature parent designs.
The memorandum builds on an executive order signed in April 2025 titled Restoring America’s Maritime Dominance. It notes that implementation is subject to the availability of appropriations, and creates no enforceable right or benefit.
We don’t really have the capacity for this do we?
You could argue Babcock do. Build two T31 for the US in Scotland and take over a yard in the US to build more on licence.
The frigate proposal is the most interesting to me. It means the USN already has cold feet over the current FF(X) program. The 50 or more ship program is for modified cutters with less inherent capability than the USCG ships they were based on. With no VLS, no ASW, no AAW, and pretty much everything added on in containers and drones, the ships rely on a new form of plug-in integration. A lot of the RN’s CCV/ hybrid capability follows the same philosophy.
So not only might this open the door for BEA to sell something like the Canadian River class (their T26 variant) into the USN, it might even lead to the restoration of the Type 83. BAE must be pretty happy.
We don’t have enough shipyards for our own needs, if we are building anything for the USN it should be submarines components. If they want foreign ships then South Korea and Japan are the obvious candidates however using a foreign yard won’t solves Americas problems. The USN will still keep fiddling with mature designs and constantly changing requirements and Congress and the MIC will still go out of its way to cancel programs mid procurement to fund job creation programs.