Hanwha and Fincantieri rally as Trump opens US Navy shipbuilding
President Donald Trump’s directive allowing foreign shipbuilders to construct up to two Navy vessels at their overseas yards has boosted European and Asian maritime stocks while complicating a major US acquisition.
Shares of Hanwha Ocean and Fincantieri climbed on Friday after President Donald Trump signed a national security memorandum permitting foreign shipyards to build certain US Navy vessels. Hanwha Ocean rose 5.6 percent and Fincantieri gained 3.2 percent as the policy shift promises to ease domestic manufacturing bottlenecks.
The Thursday directive allows overseas builders to temporarily construct up to two ships at their parent facilities for rapid delivery. To qualify for the exemption, foreign groups must make substantial investments in US shipyards and train an American workforce.
The memo specifically authorizes the offshore construction of surface combatants, consolidated cargo replenishment tankers, and roll-on/roll-off vessels. Bryan Clark, a senior fellow at the Hudson Institute, expects the initial output to focus on tankers and cargo ships rather than warships due to the high costs of redesigning combat vessels for the US supply chain.
Hanwha is widely considered the primary beneficiary of the new rules. The South Korean conglomerate purchased Philly Shipyard in 2024 and backed that acquisition with a $5 billion expansion pledge. Clark emphasized the necessity of this capital, stating, "You got to make an investment in that shipyard to enable it to produce the things that they're asking for."
Fincantieri, the largest shipbuilder in Europe, also stands to benefit from its established American footprint. The Italian company has invested more than $800 million in its US operations over the past decade, including facilities in Wisconsin. It recently secured a $30 million Navy contract for preliminary work on a medium landing ship program that could eventually encompass 35 vessels.
The policy shift introduces new complications for Hanwha’s non-binding bid to acquire the US operations of Austal. A successful takeover could deprive Austal’s Australian parent company of the opportunity to build two ships under the new exemptions. Clark noted that Australia is unlikely to make the necessary qualifying investments due to its commitments under the AUKUS submarine pact.
Austal shares also rose 5.6 percent on Friday, while both Hanwha and Fincantieri declined or delayed providing immediate comments on the memo. Meanwhile, the Shipbuilders Council of America warned that routing Navy construction overseas fundamentally undercuts the domestic industry.
