Stephen Carmel & MARAD Lead the U.S. Maritime Revival Charge Rebuilding America’s Maritime Power — and Changing the Terms of Competition

For most of my 34 years covering the maritime industry, “revitalizing the U.S. maritime industry” has not been a common sentiment from any level of government, particularly Washington, D.C., and slowly the U.S. shipbuilding enterprise slipped to an industrial afterthought in the wake of the President Ronald Reagan ‘600 Ship Navy’ era.

That mentality changed dramatically in January 2025 when President Donald Trump started his second term. While political chatter has not immediately turned to economic infusion, the process to effectively rebuild the entirety of the U.S. maritime chain is starting to gain steam, though the process will be neither quick or easy.

While there have been sporadic starts and stops over the last three decades to revitalize the U.S. maritime industry, this time it feels different, due in large part to Stephen Carmel, Administrator of the U.S. Maritime Administration (MARAD), a leader who is clearly knowledgeable and passionate about the industry he serves.

Since President Trump returned to office, there has arguably been more sustained discussion at the federal level about U.S. maritime strength, commercial shipbuilding, the Merchant Marine and the maritime industrial base in the last 18 months than the previous three decades combined. The focus now is channeling that chatter into action, and Carmel is acutely aware of that distinction, arriving at MARAD at a particularly consequential moment.

The U.S. faces a peer maritime competitor – China – with an enormous shipbuilding capacity and advantage, and apart from the U.S. domestic commercial shipbuilding capability being a fraction of what it once was, there are other problems, too:

• The U.S. sealift fleet is aging and woefully small in the case of war.

• The U.S. commercial fleet operating internationally under the U.S. flag remains small.

• The supply chain to make shipyards efficient needs to be rebuilt.

• The U.S. inland infrastructure – the arteries of U.S. commerce – contains potentially catastrophic single points of failure.

At the same time, Carmel sees technologies ranging from artificial intelligence and automation to small modular reactor (SMR) nuclear power as presenting the United States with something far more consequential than an opportunity to catch up. He wants to change the game.

“We cannot out-China the Chinese,” Carmel said. “We can't beat the Chinese by being a cheaper version of China. And we don't want to try.”

Instead, he argues, the United States must exploit what it historically does best: innovate, disrupt and change the terms of competition.

“The U.S. is awesome at innovating, at technology, at disrupting,” Carmel said. “That's what we're great at. And that's what we have to do. We have to make what the Chinese do irrelevant.”

Image courtesy Everllence

We cannot out-China the Chinese,” Carmel said. “We can't beat the Chinese by being a cheaper version of China. And we don't want to try.”

- Stephen Carmel,
Administrator of the U.S. Maritime Administration (MARAD)

From MAP to Steel in the Water

Carmel points first to the Maritime Action Plan (MAP) and the legislative machinery required to turn policy into actual programs. MARAD delivered 14 legislative proposals to Congress, he said at the time of out interview in late July 2026, with 11 incorporated into the National Defense Authorization Act that passed the House. The remaining three were tax-related measures outside the jurisdiction of the Armed Services Committee, rather than proposals rejected on their merits. The process is necessarily slower than the centralized system employed by America's primary maritime competitor, but Carmel argues that it is moving.

The fundamental issue, however, is not shipyards: it is cargo.

“The U.S. Merchant Marine is first and foremost here to carry the nation's commerce and then carry the nation to war when we need to,” Carmel said. That distinction sits at the center of Carmel's maritime philosophy. Government-generated cargo alone cannot sustain the scale of commercial fleet he believes the United States needs. The country must rebuild a merchant fleet that routinely carries American imports and exports in normal commercial service.

The U.S. NPR proposal is designed to begin that process, initially reserving 3% of the nation's commerce for U.S.-flag vessels and ramping upward, eventually transitioning toward U.S.-built ships.

Cargo creates demand for ships. Demand for ships gives shipyards the commercial justification to invest. A credible business case attracts private capital. Increased volume can help yards improve productivity and drive down unit costs. In Carmel's view, those elements cannot be treated independently.

A year from now, he said, one important measure of progress will be a measurable increase in U.S.-origin or U.S.-destination cargo moving aboard U.S.-flag ships. Looking five to 10 years out, his ambition is considerably greater: half of that cargo moving under the U.S. flag.

The second measure will be physical evidence of investment.

Carmel readily acknowledges that existing American shipbuilding infrastructure is inadequate for the international commercial market he envisions. U.S. yards capable of building very large internationally trading commercial ships simply do not exist at the scale required today.

“There’s not a yard in this country that could build an 18,000-TEU container ship,” he said.

Consequently, success cannot be measured in memoranda of understanding and Washington ceremonies. Carmel wants to see earth moving.

“When we start seeing transition from MOU signings and champagne toasts in Washington to shovels turning dirt in potential shipyards, I want to see that in the next year,” he said.

And then comes the ultimate metric. “When I start to see keels being laid for ships that are destined for trade in an international space, that's when I know we're successful.”

Capital Can Help Break the Logjam

The scale of rebuilding envisioned by Carmel cannot be financed solely through annual federal appropriations, nor does he believe it should be. One of America's competitive advantages, he argues, is the depth of its capital markets. The money exists. The challenge is creating conditions under which investors see American maritime as an investable business rather than a perpetual government-support program.

“We have lots of capital,” Carmel said. “One of the great strengths of the United States is the depth and breadth of our capital markets. And it's there waiting to get involved.”

The government's role, therefore, should be to create the business environment that mobilizes that capital.

“Like any business, the government's job is less about funding it and more about ensuring that the business case is there so that the private capital markets can take up the lead and run with it.”

MARAD is also looking inward at its existing financial tools, particularly Title XI, to help out, and Carmel admits the program's current usability is not adequate. MARAD is working on rulemaking intended to significantly streamline Title XI, followed by a broader examination of what the program finances and how. Carmel's objective is to move beyond what he characterized as a mediocre loan-guarantee mechanism and toward genuine vessel construction financing, closer to the tools available to Korean shipbuilders through Korea's export-finance infrastructure. “If we can't finance at scale,” Carmel said, “we cannot build with scale.”

MARAD is similarly reconsidering how port and shipyard grants are deployed. Instead of viewing individual awards in isolation, Carmel wants federal funding directed toward strengthening an interconnected industrial ecosystem. Shipyard modernization grants, in particular, should reward projects that materially increase productivity and construction capacity.

The target cannot simply be building vessels for a protected domestic market.

“We need to get down the cost curve to where we're building for export,” Carmel said.

Because in shipbuilding, he argues, “volume is everything.”

The Commercial Shipyard Must Return

Carmel is equally direct about one of the historical causes of America's current predicament: allowing commercial shipbuilding to disappear while increasingly structuring the industrial base around naval construction. “I think that attitude, that focus on the Navy is what ruined us,” he said. His argument is not that naval shipbuilding is unimportant. Quite the opposite. Rather, Carmel believes the disappearance of a healthy commercial foundation ultimately damaged the Navy itself.

Commercial yards and their suppliers historically provided scale, industrial depth, workforce, technology development and competitive pressure. Once that ecosystem eroded, the Navy increasingly became the only customer supporting critical pieces of the supply chain.

That, Carmel argues, turns the conventional definition of industrial vulnerability on its head.

“A strategic vulnerability is when you are the only customer for a critical vendor,” he said. “When you get to the point where you are the only customer for a critical vendor, that means you are responsible for keeping them alive.”

MARAD's mission is therefore deliberately different from the Navy's.

“Our job in the Maritime Administration is to rebuild a civilian commercial shipbuilding enterprise,” Carmel said. “First and foremost, that's all I talk about. That's all I do. That's where our investments will be.”

That means rebuilding far more than shipyards.

The industrial ecosystem needs equipment manufacturers, engineering capability, suppliers and manufacturing depth. Carmel specifically points to the absence of domestic production for the large marine engines required by internationally trading ships. He would like to see major international engine technology produced under license in the United States rather than simply imported.

Foreign partners can play an important role, particularly by bringing production methods and experience developed in high-volume commercial shipbuilding nations.

But Carmel is equally emphatic about the end state.

“We are here to build an American shipbuilding enterprise run by Americans, with American workers producing ships for the U.S.-flag fleet and the foreign-flag fleet,” he said.