The U.S. shipbuilding industry continues to lead the world in the design and construction of advanced military vessels. The United States is not now, nor has it historically been, a major producer of commercial passenger or cargo ships, however. There will be no significant growth in the commercial market for U.S. shipyards, and protectionist policies, such as the Jones Act, are not effective in sustaining the industry. The U.S. shipbuilding industry has capacity well in excess of the need for military ships. As shipyards merge and the U.S. Navy reaches its 300- ship standard, military vessels will become increasingly expensive. One means to expand competition and to bring to bear advanced business processes is for major systems integrators to team with shipyards to produce the military vessels required in the 21st century.
ICAF Industrial Studies 1999