The idea of imposing tariffs on ships misuses Section 301 and will only punish American trade even more.
The Trump administration has launched a new Section 301 investigation of China, this time targeting maritime logistics and shipbuilding.
The probe threatens new fees on foreign ships using US ports — some as high as $270,000 per voyage.
This enforcement action, while meant to look tough on China, will only hurt US exporters.
To see why, consider the so-called roll-on/roll-off vessels— also known as “ro-ros”— that haul cars, trucks, tractors, and construction machinery. They carry nearly half of US vehicle exports. Over ninety percent of new ro-ro vessels are built in China. There is no alternative fleet. None.
Charging massive fees to use them won’t revive US shipyards. It will simply raise costs for Detroit, Caterpillar, and John Deere, putting at risk thousands of American jobs tied to these and other companies’ foreign sales.
The Trump administration says the Section 301 investigation is about shipbuilding. In truth, it’s about taxing US exporters at the dock.
The damage will be even worse for sales of liquefied natural gas (LNG). The United States is now the world’s largest LNG exporter, shipping $34 billion annually. LNG contributes more to American GDP than corn or soybeans. It’s also the key to US energy diplomacy, giving allies from Europe to Asia an alternative to Russian gas.
The proposal would require LNG to be carried on ships that are US-built, US-flagged, and US-crewed. But the problem is that the United States hasn’t built an LNG carrier since the 1970s. No shipyard has the dock size or the workforce to do it. These ships don’t exist—and won’t anytime soon.
This mandate is not only impossible to meet but would also break long-term contracts, choke off US exports, and hand strategic energy markets to competitors.
This will result in fewer domestic drilling, refining, and shipping jobs, directly contradicting the Trump administration’s stated objective of “unleashing American energy.”
US LNG exports have grown significantly since President Trump’s first term. This has contributed to America becoming the world’s largest exporter of LNG in 2023. The administration has already shown that promoting American LNG exports and domestic jobs is a high priority for their energy dominance agenda, as Trump immediately lifted a Biden-era LNG export permit pause in January.
Further, the Department of Energy in June announced a landmark deal with Tokyo-based Japanese energy company JERA to commit to several twenty-year agreements on LNG purchases. Pursuing a Section 301 investigation therefore undercuts these critical developments to the US economy and our international standing in the process.
There’s also the matter of law. Section 301 was designed to confront unfair trade practices abroad. It was not written as a tool to remake US industrial policy by penalizing foreign vessels.
Using Section 301 this way distorts its purpose and sets a dangerous precedent. If shipbuilding can be folded into Section 301, then so can any industry where America lags behind its global competitors. That isn’t targeted enforcement—it’s old-fashioned protectionism with a new label.
Congress wrote Section 301 to address discriminatory trade barriers. It didn’t write it to let an administration punish US exporters for the inconvenient truth that America hasn’t built a shipyard in decades.
If the goal is to strengthen US shipbuilding, tariffs at the water’s edge won’t get us there. Modernizing shipyards, supporting training programs, and funding research and development will.
Working with allies would also go a long way in this regard. Japan and South Korea lead global commercial shipbuilding. Partnering with them to diversify supply chains makes more sense than penalizing American exporters every time their goods leave port.
Shipbuilding is part of a much larger competitiveness problem, and one that can’t be solved by taxing exports.
China’s shipbuilding dominance is structural and was built over decades of state investment. A fee won’t change that.
Instead, it will simply make American goods more expensive to ship. It will undercut LNG exports. It will put US auto and equipment manufacturers at a disadvantage. And it will invite retaliation from trading partners who see through the pretext.
Instead of building a maritime strategy, the Trump administration is reaching for a blunt tool that won’t result in a single ship being built. It will only sink America’s most competitive exporters.
Section 301 was never meant to serve as an industrial policy tool. Repurposing it this way is not a strategy—it’s a costly distraction. The right path is investment, not tariffs. If America wants a stronger shipbuilding sector, it must build one.
Congress and the business community should call out this policy for what it really is: a tariff that plainly misses its target and hits America instead.
About the Author: Dr. Marc L. Busch
Dr. Marc L. Busch is the Karl F. Landegger Professor of International Business Diplomacy at the Walsh School of Foreign Service, Georgetown University. He previously served for two terms as a “cleared advisor” on technical trade barriers to the US Department of Commerce and the United States Trade Representative. He has addressed a wide range of governments and international institutions, including the Advisory Centre on WTO Law, the Swedish International Development Cooperation Agency, the World Bank, and the United Nations. He holds a B.A. in International Affairs from Queen’s University, an M. Phil. in Political Science from the University of Toronto, and a Ph.D. in Political Science from Columbia University in the City of New York.
Image: Shutterstock/S.Gvozd
