Huntington Ingalls Industries is surging after Trump pledges to “resurrect” US shipbuilding
To paraphrase The Wire’s Frank Sobotka, we used to make ships in this country.
And during Tuesday night’s address to Congress, President Donald Trump said his administration is going to “resurrect” this domestic industry, adding that he’ll launch a new Office of Shipbuilding in the White House.
“We used to make so many ships. We don’t make them anymore very much, but we’re going to make them very fast, very soon,” he told Congress, and said he hopes to offer special tax incentives for the industry.
Upon the imposition of tariffs on products from Canada and Mexico, shares of much everything that you used to get around (planes, trains, and cruise boats) all slumped. But that remark from Trump’s speech opened up an exception, and now investors are all aboard Huntington Ingalls Industries on Wednesday. The shipbuilder’s stock has struggled in recent months — down over 40% in the past year through Tuesday’s close — but is staging a rebound today, up around 12%.
Huntington Ingalls Industries is the country’s biggest military shipbuilder, working to design, build, and maintain nuclear and nonnuclear ships for the US Navy and Coast Guard. The company’s contracts with the US military carry a heavy price tag, often costing upward of $1 billion for just one ship. A four-ship contract secured back in September totaled a whopping $9.6 billion.
Shortly before Trump’s speech, The Wall Street Journal reported that the administration has drafted an executive order aimed at such goals, including measures to minimize China’s dominance in the industry with fees on ships and cranes built in the country that enter the US.
Similar proposals pursued in the past to boost US shipbuilding have hit snags or delays in the approval process, but an executive order from Trump could speed up the process.
