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Navy intelligence says China’s shipbuilding capacity is more than 200 times more powerful than the US

A leaked online publication from the US Office of Navy Intelligence (ONI) highlights concerns about a rapidly growing Chinese Navy and the country’s continued ability to produce ships faster than the United States.

“The Chinese see this decade as a strategic opportunity,” Brent Sadler, senior research fellow for naval warfare and advanced technology at the Heritage Foundation’s Center for National Defense, said. “I don’t see a bending of the curve in the short term where we will close the gap with the Chinese.”

Sadler’s comments come after images of the unclassified Office of Naval Intelligence slide were widely circulated online. The image, which was picked up in a War Zone report, shows China’s enormous shipbuilding capacity compared to the United States.

The authenticity of the slide was confirmed by a Navy spokesman, who cautioned that it was not intended as an in-depth analysis.

“The Office of Naval Intelligence developed the slide from multiple public sources as part of a general briefing on strategic competition,” the spokesperson said. “The slide provides context and trends on China’s shipbuilding capacity. It is not intended as a deep dive into the PRC’s commercial shipbuilding industry.”

The slide shows that Chinese shipyards have a capacity of about 23.2 million tons, compared to less than 100,000 tons in the US, making China’s shipbuilding capacity more than 232 times that of the US.


The slide also shows the “composition of forces” of the countries’ two navies side by side, including “combat ships, submarines, mine warfare ships, large amphibious ships, and large combat support auxiliaries.” The ONI estimated that China had 355 such naval vessels in 2020, while the US had 296. The disparity is expected to continue growing every five years until 2035, when China will have an estimated 475 naval vessels, compared to 305-317 US ships.

Another part of the slide provides an estimate of the percentage each country allocates to ship production in its shipyards, with China getting about 70% of its shipbuilding revenues from shipbuilding, compared to about 95% of U.S. shipbuilding revenues.

However, that disparity is also concerning, said Sadler, who noted that China would gain a strategic advantage by having a robust commercial shipbuilding sector.

“Shipbuilding is a strategic industry, and they realized that a long time ago,” Sadler said of China. “The first part was building your commercial shipbuilding sector… commercial shipbuilding was the origin of all this enormous capacity. The lesson is that you can’t have a naval shipbuilding industry without a commercial shipbuilding sector and the Chinese have been doing that for 30 years. years.”

China’s centrally planned economy allows the country to control labor costs and provide subsidies for its shipbuilding infrastructure, allowing the Chinese to outbid most competitors around the world and dominate the commercial shipping industry, Sadler said.


On the military side, Sadler noted that the Chinese began acquiring technology from the Soviet Union, later Russia, and Ukraine, modeling many of their naval vessels after technology from those countries.

“Then you get more shipyard workers, and sometimes these commercial shipyards, where one side is building tankers, LNG ships, and container ships, and right next door they’re building cruisers and destroyers, sometimes with the same shipyard workers,” Sadler said.

Sadler argued that the US has not built comparable shipbuilding infrastructure because builders only have the US government as a customer.

“The federal government is the only customer… your biggest customer where you get the biggest profit margin is building big high-tech expensive Navy ships,” Sadler said. “That’s the only show in town for us. And unfortunately, because that’s the case, no one wants to become competitive and build better container ships or the next generation of commercial shipping ships, and that’s what we need to do.”

Navy intelligence says China's shipbuilding capacity is more than 200 times more powerful than the US

The USS Theodore Roosevelt leaves its homeport in San Diego. (US Navy via Getty Images)

While much of the attention on China’s advantage in shipbuilding has focused on the country’s naval capabilities, Sadler said China’s advantage in commercial shipping also has major implications for U.S. security and the economy.

“In peacetime, the average family is just trying to get diapers, baby food, bottled water, toilet paper, or during COVID, personal protective equipment, masks. A lot of that supply chain, the ships, the movement, the shippers, they’re tied to the Chinese market or they’re Chinese ships,” Sadler said.

“We had a backlog of containers in China because it was more profitable to keep cargo in China,” Sadler added. “It created a supply backlog. There were situations that many people probably remember of empty shelves. Part of the reason for that was an over-reliance on this global supply chain, which was overwhelmingly centered in China.”

The US Navy intelligence’s 19,000-ton cargo ship runs aground in Bahrain

That dominance in commercial shipping is also reflected when it comes to potential conflict, Sadler added, arguing that the over-reliance on Chinese shipping would allow China to “very effectively punish us” in response to hypothetical US sanctions if they were to get more. aggressively around Taiwan.

“The United States depends on more than 80,000 visits to keep its economy afloat through foreign-flagged ships, to keep the lights on … the stores and industries running,” Sadler said. “So if the Chinese essentially push themselves out of that market, we lose the ability to sustain our economy, and the shocks of that are appreciated.”

Reports this week by the South China Morning Post indicate that China may be closing in on a new giant warship, with online images of workers at the Hudong-Zhonghua shipyard holding flags next to what appears to be a next-generation amphibious assault ship.

In a potential direct conflict with China, Sadler argued that the consequences of inequality in shipbuilding would be “even direr”, pointing to possible rations similar to those of World War II. The consequences of the situation could also be felt in a battle at sea, where China would have the ability to produce, repair, and replace naval vessels faster than the United States.

Despite the looming threat, Sadler said the U.S. has not been working toward the goal of increasing the number of U.S. Navy ships.

“Every budget over the last three years during the Biden administration … the long-term plans have all projected a reduction in the size of the Navy when the danger goes the other way, it goes up,” Sadler said.

President Biden’s proposed fiscal year 2023 budget called for a reduction of 15 ships from the Navy’s fleet, according to a report from the Association of the United States Navy earlier this year. While the proposal allowed financing for the construction of nine new ships, it also proposed the decommissioning of 24 ships, leading to an overall reduction in the fleet.

us president

President Joe Biden (Brendan Smialowski/AFP via Getty Images/File)

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Biden’s fiscal year 2024 budget also called for the elimination of 11 ships, a plan criticized by Sen. Roger Wicker, R-Miss., the ranking member of the Senate Armed Services Committee.

“We must work quickly to expand our Navy fleet,” Wicker said in a news release earlier this year. “As I said, the size of the Chinese fleet is larger than ours, and yet the Ministry of Defense is proposing the dismantling of ships. The Marine Corps was unable to recover the victims of the earthquakes in Turkey a few months ago because the navy did not have enough amphibious ships.”

Wicker was at the center of an effort in 2017 to set a goal of a Navy fleet of 355 ships, a proposal that became law in the 2018 National Defense Authorization Act after it was signed by former President Donald Trump.

But budget proposals in the years that followed fell short of those expectations, including Biden’s 2024 proposal that called for the reduction of 11 ships.

Speaking to reporters about the proposed reduction earlier this year, Admiral John Gumbleton said eight of the 11 ships were eliminated before reaching “the end of their service life” due to the ship’s “material condition, remaining service life, cost and then time to upgrade.”

“These six ships failed the ROI analysis. In addition to the time and money saved with this divestiture, we will also free up more than 1,500 Sailors to support higher priority efforts,” Gumbleton said.

us pentagon

The Pentagon (Tom Brenner/Bloomberg via Getty Images/File)

When asked if the Navy’s fleet continued to hover below 300 ships during the same briefing, Undersecretary of the Navy Erik Raven told reporters that “readiness, modernization … and capability, in that order, are the priorities that … this managing the budget.”

“We are continually working with our industry partners to ensure that we not only finance but also take delivery of the vessels on time and in an efficient manner,” said Raven.

According to Sadler, the US’s inability to adequately invest in its shipbuilding capacity has not been a “partisan issue.” He argued that “the political leaders of both parties have failed on this issue.”

Sadler added that lawmakers must “take the threat seriously” and “create plans and budgets that … grow the Navy.”

“We need consistency in budgets,” Sadler said. “We have to find a way to regain a competitive advantage so that there is a reason: a profitable market space for young Americans to join something that, is exciting, and that they can make a very good living in shipping in shipbuilding. That just doesn’t exist at the moment.”



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