At the annual Sedona Forum hosted by the McCain Institute, Admiral Samuel Paparo, commander of the U.S. Indo-Pacific Command, issued a sobering warning that echoed far beyond the red rocks of Arizona. Standing before an audience of national security experts and policymakers on May 2, Paparo bluntly outlined a growing disparity that could tilt the balance of power in the Pacific: the United States is falling behind China in naval shipbuilding — and fast.
According to Paparo, China is producing two submarines for every 1.4 built by the United States and constructing six combatant warships annually compared to America’s 1.8. These figures, he emphasized, are not just statistics. They are a measure of strategic risk in an era where maritime supremacy will likely define global influence.
“Shipbuilding is the foundation of naval power,” Paparo said. “And we are losing that race.”
His remarks highlight a tectonic shift in global naval dynamics — one where Beijing’s industrial machine is outpacing the United States in both scale and speed, raising urgent questions about America’s ability to project power in a region increasingly dominated by Chinese steel.
The U.S. Navy, long regarded as the world’s premier maritime force, currently fields 219 warships and 66 nuclear-powered submarines. Its submarine fleet remains the sharpest edge of its underwater dominance, led by the stealthy, multi-mission Virginia-class attack submarines and the strategic Ohio-class ballistic missile submarines.
Virginia-class boats — stretching 377 feet with a submerged displacement of around 7,800 tons — are nuclear-powered and equipped with Tomahawk missiles and advanced sonar systems. Their roles span anti-submarine warfare, intelligence collection, and long-range strikes. Yet the production of these vessels has stumbled, with the Navy falling short of its goal to produce two per year.
The Ohio-class forms the sea-based leg of the U.S. nuclear triad. Fourteen of these giants carry up to 20 Trident II D5 nuclear missiles each. Another four have been converted into guided-missile platforms, capable of launching up to 154 Tomahawks. These platforms, while formidable, are aging — and costly to replace.
Behind this slow roll of production lies a broken pipeline: a constricted industrial base, a skilled labor shortage, and congested maintenance yards. All ten naval shipyard dry docks and three commercial repair facilities are currently operating at full tilt, with many vessels stuck in port waiting for parts or labor.
By contrast, China’s People’s Liberation Army Navy (PLAN) has surged into the global spotlight. Now the largest navy in the world by hull count, the PLAN operates 234 warships and an estimated 60 submarines — 12 of them nuclear-powered.
China’s rapid growth is no accident. It is the outcome of deliberate state-driven strategy. Major shipyards such as Bohai, Dalian, and Jiangnan operate under the vast umbrella of the China State Shipbuilding Corporation (CSSC), formed in 2019 through a mega-merger designed to streamline military shipbuilding.
The result: unmatched capacity. A 2023 analysis from the Alliance for American Manufacturing noted China’s shipyards boast a staggering 23 million tons of annual shipbuilding capacity. America’s capacity? Less than 100,000 tons.
This industrial gap is more than academic. It translates into capability. In 2022 alone, the PLAN added ten warships and a submarine to its fleet — over 110,000 tons in new displacement. Many of these ships, like the Type 055 Renhai-class cruiser, are cutting-edge. The Type 055 displaces 13,000 tons, bristles with 112 vertical launch cells, and rivals America’s best destroyers in radar, weapons, and command systems.
Meanwhile, China’s submarine force has matured quickly. The nuclear-powered Type 094 Jin-class ballistic missile submarines can strike the U.S. West Coast from the South China Sea with JL-3 missiles. The newer Type 093B Shang-class attack submarines are quieter, more lethal, and closing the acoustic signature gap with U.S. boats.
China’s fleet of 20 Yuan-class and 10 Kilo-class diesel-electric submarines — optimized for the shallow, congested waters of the First Island Chain — adds another dimension to its undersea arsenal.
The root of America’s shipbuilding lag lies in its industrial structure. The U.S. Navy depends on a handful of legacy yards — General Dynamics Electric Boat, Newport News Shipbuilding, Ingalls Shipbuilding, and Bath Iron Works — each highly specialized, regulated, and struggling with labor shortages.
Retired Navy Captain Jerry Hendrix has sounded the alarm repeatedly. “We are barely making one submarine a year,” he warned in late 2024, “when our long-term plan calls for three fast-attack and one ballistic missile sub annually.”
Paparo echoed these concerns. “We don’t just need more ships,” he said. “We need to fix how we build them.”
In contrast, China’s civil-military fusion allows commercial innovation to bleed directly into military platforms. Their shipyards benefit from vast pools of subsidized labor, minimal environmental regulation, and centralized control. If Beijing decides to build a ship, it gets built — fast.
Underlying all of this is the looming specter of a Taiwan conflict. Paparo noted that while the U.S. still maintains critical technological and alliance advantages — particularly in space-based intelligence and long-range strike — the shrinking ship count poses a long-term risk.
“If deterrence fails, we will fight and we will win,” he said, referencing America’s advanced capabilities to disable Chinese space assets and command networks. “But deterrence is rooted in credible capability — and numbers matter.”
Should conflict erupt over Taiwan, the U.S. and its allies would be challenged to hold sea lanes and conduct operations in a region where China’s ships are closer, newer, and more numerous.
The U.S. is not alone in the Indo-Pacific. Japan, South Korea, and Australia all field modern navies. Japan’s Maritime Self-Defense Force has 34 destroyers. South Korea boasts advanced frigates. And under the AUKUS agreement, Australia will soon operate Virginia-class submarines of its own.
These alliances offer hope — and force multiplication. But they are not a substitute for industrial resilience. As Paparo noted, the real contest is not today’s order of battle, but the trajectory. China is building toward 425 warships by 2030. The U.S. Navy hopes to hit 300 by then.
Efforts to revive U.S. shipbuilding are underway. The Navy’s FY2025 budget allocates $403 million for submarine industrial base improvements. Legislation like the Save Our Shipyards Act proposes tax incentives for skilled trades, upgrades to dry docks, and grants for shipyard modernization.
But experts remain skeptical. “Throwing money at the problem won’t work if you can’t find welders,” said Loren Thompson, a defense analyst at the Lexington Institute. “You need people, parts, and predictability.”
The U.S. government halted shipbuilding subsidies in 1981. Since then, the commercial shipbuilding sector has collapsed. While China’s shipyards churn out 50% of the world’s commercial ships, America builds less than 0.5%.
This matters because commercial production feeds military capacity. A healthy commercial base keeps workers employed, equipment running, and innovation flowing. Without it, military yards are isolated and vulnerable to bottlenecks.
During World War II, American shipyards defined industrial victory. In just four years, they produced over 2,700 Liberty ships and more than 140 aircraft carriers. The U.S. Navy dominated by building faster than the enemy could sink.
Today, the muscle memory of that era is gone. Instead, America relies on just two yards to build all its submarines. When one experiences a delay — as Electric Boat has — the entire submarine program slips.
China, in contrast, has cultivated its shipbuilding industry over decades, beginning with Soviet help in the 1950s. By the 1960s, Chinese yards were churning out Romeo-class subs. Today, they not only dominate commercial shipping but also export warships to Pakistan, Thailand, and Algeria — a further indicator of their scale.
Admiral Paparo’s assessment is not a doomsday prediction, but a rallying cry. “This is a race we can win,” he said, “but we have to run it.”
Winning will require a national maritime strategy that treats shipbuilding as a pillar of national security, not just a procurement issue. It means investing in trade schools, supplier networks, and dual-use infrastructure. It means rethinking how America contracts, builds, and maintains its naval forces.
Most of all, it means acting now. As China’s fleet grows not just in size but in sophistication, the United States must decide whether to match pace — or fall into decline.
For now, the U.S. Navy remains the more capable force. But unless America rebuilds its maritime industrial base, that edge may not last much longer.
The Indo-Pacific is quickly becoming the arena for this century’s defining geopolitical contest. Whether the U.S. can maintain its naval superiority will hinge not on what it already has, but what it can build — and how fast.
As Admiral Paparo made clear, this is no longer about plans and projections. It’s about production. And in the steel-forging crucible of the shipyard, time is not on America’s side.
