Navy secretary warns U.S. shipbuilding is behind, vows plan to rebuild maritime industrial base
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Summary
Secretary of the Navy John Phelan told the House Armed Services Committee the Navy’s shipbuilding programs are “behind schedule and over budget,” and outlined a near-term push and longer-term plan to rebuild industrial capacity, workforce and contracting practices.
Secretary of the Navy John Phelan told the House Armed Services Committee on the Navy’s FY26 budget that U.S. shipbuilding is “behind schedule and over budget,” and that the service is developing a plan to restore the maritime industrial base.
Phelan said the department is advancing a two-track effort: short-term options to get “holes in the water” quickly and a long-term program to rebuild U.S. capacity. “All of our programs are a mess, to be honest. We are behind schedule and over budget. I think our best performing one is 6 months late and 57% over budget,” Phelan said.
The committee was told why the topic matters: naval capacity underpins deterrence and power projection, and Phelan and other witnesses repeatedly connected shipbuilding capacity to the ability to counter China. Phelan described visiting 10 shipyards—seven in the United States and three overseas—and said the department will need capital, reduced bureaucracy and possibly new or expanded shipyards to restore industrial capacity.
Members pressed for specifics and schedules. Chairman Mike Rogers asked when the department would deliver a plan; Phelan said he was “on day 72 of the job” and was pushing for a “something done in the next 30 to 60 days” that would outline the department’s approach. Lawmakers said they need that detail quickly to inform the FY26 NDAA timeline.
Committee members and witnesses described several concrete stress points: long delivery schedules and cost growth on current classes, insufficient skilled shipbuilders, and a procurement and requirements process that witnesses said adds time and cost. Phelan and Admiral James Kilby, the acting chief of naval operations, both said consistent, predictable funding and reforms to acquisition and contracting would be necessary to support any industrial ramp-up. Members from shipbuilding states urged use of the SHIPS Act and other authorities to incentivize investment.
Witnesses also raised complementary near-term measures, including using allied yards for repair and surge maintenance and exploring commercial vessels and retrofits for logistics roles, while stressing that allied support could not substitute for a revitalized U.S. base. Representative Seth Moulton and others highlighted examples where industrial collaboration and workforce programs—training and advanced manufacturing centers—could speed parts production and repairs.
The hearing ended with a pledge of collaboration: Phelan said the department will return with specifics, and members said they would work with the Navy to align budgets, authorities and oversight. The committee repeatedly framed the issue as urgent for readiness and deterrence, and asked the department to avoid piecemeal fixes and present a coherent demand signal to industry.
Looking ahead, Phelan told the committee he intends to present more concrete timelines and proposals and to work with Congress on statutory fixes and funding to restore capacity.
