China Outbuilds America 230-to-1. Saronic Has a Plan
In a Nutshell
Saronic is building autonomous ships to counter China's 230-to-1 shipbuilding advantage, having already demonstrated the first autonomous rescue of American pilots in the Strait of Hormuz using their 24-foot Corsair vessel. The company plans to produce hundreds of attritable ships annually with vertical launch systems at a fraction of traditional destroyer costs, leveraging integrated design-build operations and firm-fixed-price contracts rather than cost-plus models. Their strategy focuses on mass deployment of unmanned vessels in contested waters to keep personnel safe while delivering 320 VLS tubes per year versus 10-15 from conventional $3 billion destroyers.
These notes were generated by AI and may contain inaccuracies.
Saronic co-founders Dino Mavrukas and Vib Alka car joined the All In interview. The company recently made news with an autonomous ship operation in the Strait of Hormuz, representing the first time an autonomous ship rescued people in the field.
The mission involved rescuing two downed American pilots in a contested environment during conflict with Iran. The Navy trusted Saronic's Corsair, a 24-ft fully autonomous speedboat, to conduct the rescue rather than risking additional personnel. This demonstrated the ability to rescue people without putting soldiers in harm's way.
Dino Mavrukas shared a personal story from his Navy SEAL experience (2004-2015, with the last 5 years on SEAL Team 6), referencing the 2005 incident where four SEALs were trapped on a mountainside in Afghanistan and the rescue helicopter was shot down.
The pilots were in the water in a contested environment in the Straits of Hormuz. When the autonomous Corsair arrived, they recognized it as their way home. The pilots did not know in advance they would be rescued by an autonomous ship.
The United States can build 100,000 gross tons of ships per year. China can build 23 million gross tons, representing a 230-to-1 advantage. Thirty years ago, China had 5% of the world's shipbuilding capacity; today it has 57%. The Communist Party subsidizes raw materials and labor costs, making Chinese-built ships five to six times cheaper than American equivalents.
The US naval fleet has 296 ships against a congressional mandate of 355 ships established in 2018. Last year, the US built 9 ships but retired 19 vessels. China delivered approximately 30 ships last year with a fleet size around 370, projected to reach 450 ships soon.
The commercial shipbuilding gap is even larger: China delivered over 1,000 commercial ships last year while the United States built 5.
Autonomous ships eliminate the need for beds, commissaries, latrines, separate electrical systems for humans, doors, bathrooms, and stairs. This allows optimization across naval architecture, speed, range, payload, and control authority. Commercial 24-foot boats typically cannot achieve 1,000 nautical mile range, whereas autonomous designs can optimize for this.
The Corsair name was chosen purposefully, referencing the Saronic Gulf off Athens where the Battle of Salamis occurred - a naval battle where smaller, more maneuverable Greek ships defeated the larger Persian fleet.
The goal is large-scale attritable mass rather than building aircraft carriers that take 10 years and cost $13 billion. The focus is reducing the cost of operating in the ocean by deploying at scale with fewer personnel while removing people from harm's way.
A naval destroyer costs $3 billion and takes 6-8 years to build, carrying 96 VLS tubes (approximately 100 for calculation purposes). This delivers 10-15 VLS tubes per year at $30 million per tube. Saronic plans to build 20 Marauder ships per year at their Louisiana shipyard, each carrying 16 VLS tubes, delivering 320 VLS tubes per year at a fraction of the cost.
The future involves a hybrid Navy combining manned and unmanned ships. Manned ships will have forward-deployed decision makers, while unmanned ships handle combat areas to keep personnel safe. Mission requirements determine what is lost by removing humans - for long-range fires missions with VLS tubes on Marauder, nothing is lost while keeping people out of harm's way.
Shipbuilding production challenges stem from underinvestment in the supply chain due to low build rates. Saronic's vertical integration allows direct work with manufacturers, non-recurring engineering work, and digitization of historically analog components. Software absorbs work previously done manually in engine rooms, such as monitoring coolant pressure.
Components are either commercial off-the-shelf or built in-house when the marine industry hasn't had sufficient investment. Electronics related to sensors and compute are examples of in-house development.
Saronic has raised $2.5 billion in private capital over 4 years, investing in R&D including IRAD (Internal Research and Development) for the 180-foot Marauder. This contrasts with traditional cost-plus contracts where contractors earn 10-15% profit on top of costs, creating perverse incentives to increase costs and timelines.
Large primes face investor pressure for share buybacks, while Saronic's investors provide capital for building future capabilities. The administration is pushing for faster adoption at speed and scale, moving away from cost-plus models.
The current administration has issued a maritime executive order followed by a maritime action plan, with a Ships Act currently in Congress. The secretary has given a full speech on defense acquisition reform focused on moving faster and working with companies building on firm fixed price contracts that deliver at speed and scale while driving down cost for the taxpayer.
Only 1% of the Department of Defense budget currently goes to autonomous systems, which is considered insufficient. Recommendations include increasing this allocation to 5% or higher to meet strategic needs.
Historically, shipbuilding separates design from construction, with different entities handling each phase. A key statistic indicates that 70% of sequence-critical components on some Navy ships come from sole-source suppliers. This structure removes incentives for change or efficiency improvements since payment is guaranteed regardless of performance.
Saronic owns both the design and shipyard operations, allowing software engineers, shipbuilders, naval architects, and welders to collaborate directly. This enables end-to-end optimizations that traditional separated systems cannot achieve.
The Strait of Hormuz connects the 200-mile-wide Persian Gulf to the Indian Ocean through a 20-mile-wide strip. One side is controlled by Iraq, Kuwait, Saudi Arabia, UAE, Qatar, and Oman, while Iran controls the northern side. Iran can disrupt traffic using missiles, fast attack vessels, naval mines, and cheap drones launched from shore, creating a chaotic environment that makes traditional naval destroyer operations extremely dangerous.
Autonomous vessels provide scale, persistence, and risk reduction capabilities that manned vessels cannot match. These systems can counter threats from fast attack vessels, cheap drones, and floating mines while keeping personnel out of harm's way.
Saronic began with 6-foot and 15-foot subscale demonstrators called Cutlass and Spyglass but has not productized these. The flagship product is Corsair, with current manufacturing capacity to build 2,000 Corsair vessels per year at the Austin facility.
The operational environment requires counter-UAS capabilities to address fast attack vessels and cheap drones, plus mine countermeasures for floating mines deployed without regard for collateral effects.
Current Corsair vessels include heavy compute capacity running multiple machine learning applications for navigation, autopilot functions, and payload operations including counter-UAS missions. The system uses multiple radio communications and sensors networked together with ML components to translate commander intent into mission outcomes.
China has demonstrated weapons on robot platforms including Spot robots, with demonstrated capabilities indicating production systems. North Korea and other adversaries are pursuing similar developments. The US operates under autonomous weapon system standard 3009, which outlines how AI can be used on autonomous systems.
Even in autonomous operations, artificial intelligence serves to distinguish between enemy and friendly vessels and between non-combatants and combatants. Human operators retain decision authority and set mission intent, while government policy determines engagement authorization thresholds.
The technology enables policy thresholds and approval requirements to be built into software based on government procedures. Authorization levels can adjust based on the threat environment, allowing commanders to implement rules such as treating all non-friendly vessels as enemy vessels during active conflict scenarios.
Saronic is focused on allies and partners, with Department of Defense and Navy support for providing these capabilities to allied nations. Discussions are underway with allies in Asia, Europe, and the Middle East regarding both product delivery and establishing domestic production capabilities with overseas production lines for forward deployment.
Port Arthur represents the shipyard of the future, designed to restore American shipbuilding capacity to World War II levels. The company currently operates a 100-acre shipyard in Franklin, Louisiana, building Marada vessels with plans to reach 50 units per year.
After a year-long search, Brownsville, Texas was selected for the Port Arthur facility on an 800-acre plot, making it the largest shipyard in the United States. The site has potential for expansion to 4,000 acres, with planned investment of billions of dollars and creation of 10,000 jobs over 10 years.
Austin provides access to both digital talent including software and AI expertise, and industrial base capabilities from San Antonio and Houston's oil and gas industry. This enables hardware-software co-design approaches similar to chip development, optimizing both ship design and manufacturing processes simultaneously.
The focus includes rebuilding the American shipbuilding workforce through upskilling existing talent for advanced manufacturing and transitioning workers from industries like automotive. The approach emphasizes designing ships from first principles for simplified manufacturing at scale, then developing training, work instructions, and processes accordingly.
All employees including welders and pipefitters receive wages and benefits equivalent to Silicon Valley software engineers, plus equity participation. The Louisiana shipyard workforce demonstrates high engagement, with community support evidenced by public recognition of employees wearing company hats.
Current US shipbuilding costs are five to six times higher than Chinese production. Saronic targets cutting US ship costs in half through product and process investments rather than wage reduction, with a $300 million vessel potentially reduced to under $150 million.
The company is aggressively hiring with 300 positions listed on saronic.com. Key attributes sought include neuroplasticity and adaptability to rapidly evolving technology, particularly as AI agents become integrated into manufacturing processes. The transition from pen-and-paper processes to 21st century digital systems requires thoughtful adaptation and passion for building the future.
I am very optimistic. I know this country can do it. When we put our minds and we get a collective effort behind something, nobody can beat us.
Nobody can beat us. And listen, if you were thinking of going optimizing an ad network at some big tech company, like incredibly boring. And it's incredibly meaningful. You'll get 20, 30 years into your career and you say, "What did I do?" Go work at Saronic. You'll get couple of years into your career and you say, "I'm doing important work."
Every person that walks through the door every single day is quite literally changing the world. And we remind them of that and they know it.
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