Automation Is the Key – Summary and Key Points: Despite setbacks like the delayed Maritime Action Plan and the cancellation of the Constellation-class frigate, expert John Schmotzer argues there is a “silver lining” to America’s broken shipbuilding industry.
-Unlike competitors burdened by “tech debt” from slightly older systems, the U.S. has a blank slate to adopt highly efficient, automation-first shipyards. With a shortage of 400,000 skilled workers, automation threatens no jobs; instead, it offers a path to leapfrog foreign rivals.
-By stripping down outdated yards or building new ones in places like the Great Lakes, the U.S. can achieve a 250% productivity boost and operate 24/7.
Robots Won’t Steal Jobs: Why US Shipyards Need Automation to Fill a 400,000 Worker Gap
America’s efforts to revitalize its shipbuilding have hit three straight potholes. The White House’s Maritime Action Plan (MAP), charged with laying out how America can create economic incentives and market-based ecosystems to drive domestic shipbuilding capacity, is two months late. The cancellation of the Constellation-Class frigate program casts real doubt on whether the U.S. Navy is capable of buying a ship without nitpicking it to failure. America’s best hope for revitalizing U.S. shipbuilding, namely passage of the SHIPS for America Act, faced a setback following the public antagonism between President Trump and the bill’s primary Democratic sponsor, Senator Mark Kelly.
It’s not as though things were going swimmingly before, either. America produces just 0.1% of the world’s shipping capacity. America’s shipyards are old and rely on outdated technology. They are smaller than those of America’s competitors. America’s supplier network is weak.
Yet there is a silver lining in this bleak situation: it will be far easier for America to adopt highly-efficient, automation-first shipyards than even some of our competitors. We do not have nearly as much money – or as many jobs – tied up in outdated technology and practices.
We have less “tech debt,” and we can use that freedom to skip past a lot of steps our competitors had to work through to get to where they are today. We can only get there, though, if we are disciplined about embracing the most modern solutions.
First, automation will not put American jobs at risk, and for a very simple reason: the only jobs robots will “replace” are ones that we have not been able to fill and, at the rate America is producing welders, electricians, pipefitters, and the like, won’t be able to fill for decades. Between surface warfare and submarine ships alone, the U.S. shipbuilding base is short of nearly 400,000 skilled workers. That’s not even counting commercial shipbuilding needs. Local shipbuilding hubs face even more intense shortages; Hampton Roads alone is short 10,000 skilled workers.
The workers the shipbuilding industry can secure will also become more valuable. It’s not just that automation will drive up productivity-per-worker hour, though that is critical. Without the existing workforce, there would be no way to train the AI models that will make automation possible. Such training is invaluable, and shipyards will have to compensate their workforce accordingly. Given both the shortage of available workforce and existing workers’ increasing value, everyone in this industry should not only be able to keep their job, but expect ever-rising wages for the balance of their careers. One could even argue that, by helping the U.S. shipbuilding industry become more economically competitive, automation will help that industry grow and create more jobs in construction, marine engineering, IT, and robotics maintenance.
Which brings us America’s next advantage: America has both ample coastline for building new shipyards and its existing shipyards are small enough that ripping them down to the studs and building automation-first infrastructure is a smaller lift. Further, because our shipbuilding industry is so undercapitalized, it has not built a shipyard on every inch of coastline already suited to one. Shipyards need deep, protected, and calm waters right by the coast, and America has such sites in spades. From Collinsville, California to the Indiana and Michigan coasts on the Great Lakes to the Gulf Coast, we could build massive shipyards from scratch, limiting disruptions to existing national shipbuilding operations. And that’s not even counting sites that once held shipyards and could again, like Sparrow’s Point outside Baltimore.
The short-term opportunity, however, lies in stripping existing, outdated shipyards down to the studs and replacing old systems and technology with the advanced manufacturing processes and novel AI applications. More modern foreign shipyards are still paying off technology and manufacturing equipment a generation or two behind what is available today. For them, upgrading isn’t a straightforward economic proposition; it won’t provide as big a leap forward in productivity and it would leave those shipyards paying the financing costs on multiple sets of equipment, all while delaying existing, revenue-generating projects.
The cost of upgrading is far lower for American shipyards while the benefits are far higher. The upside of America’s decades of neglect of our shipbuilding is that we have sunk less cost and less investment into existing technologies. Their manufacturing equipment and processes are a decade or more behind the curve. That means upgrading is the exact inverse of the factors that would make a more advanced shipyard hesitant to embrace the latest technology; American shipyards would not carry substantial debt tied to existing equipment and new approaches would create enormous gains in productivity.
And make no mistake, those gains would not be marginal, iterative gains; they would be a quantum leap. First and most obviously, they would enable shipyards to operate 24/7. That would create a 250% productivity improvement without a corresponding need for human capital. But there’s more. AI would enable microwave and induction-based metal casting, when coupled with additive manufacturing, to work at scale; eventually, shipyards wouldn’t have to stop work to wait for parts to install. Most critically, automation-first shipyards would empower shipyards to collect and learn from the immense amount of data they create. They should be collecting a minimum of one to five petabytes of vision data alone; they aren’t. The productivity gains hidden in this data would be immense.
America’s Shipbuilding Crisis Can Be Fixed
The second Trump Administration began with a burst of optimism that a new day had arrived for American shipbuilding. The President even saw fit to mention shipbuilding initiatives in his first address to Congress. As the realities of revitalizing an industry that has been in decline for 40 years have set in, however, that initial burst of excitement has faded. Close observers have fallen into pessimism.
They shouldn’t. Revitalizing shipbuilding was never going to be easy. We’re in the first inning of a nine-inning game, and there are still plenty of hurdles to clear. That said, with sufficient political capital – not to mention actual capital – America can not only gain parity with our foreign competitors, but leapfrog them.
We could once again have shipyards that are the envy of the world.
About the Author: CEO John Schmotzer
John Schmotzer is Founder and CEO of Nyx Robotics and Nyx Dockworx. An expert in automation, robotics, and AI, he led modernization initiatives for major shipbuilders, car manufacturers, defense contractors, and chipmakers. His initiatives have created productivity increases generating billions of dollars.
