Secretary of the Navy John Phelan has announced a $448 million strategic investment in the Shipbuilding Operating System (Ship OS) to accelerate the adoption of artificial intelligence and autonomy technologies across the industrial base.
The initiative, managed by the Maritime Industrial Base (MIB) Program in collaboration with Naval Sea Systems Command (NAVSEA), will aggregate data from enterprise resource planning systems, legacy databases, and operational sources. The aim is to identify bottlenecks, streamline engineering workflows, and support proactive risk mitigation.
The announcement was made during the first Department of the Navy Rapid Capabilities Office Industry Day where Phelan was joined by Palantir Chief Executive Officer, Alex Karp .
Ship OS will leverage Palantir’s software to bring modern best practices to the complex, data-heavy environment of navy shipbuilding.
“This investment provides the resources our shipbuilders, shipyards, and suppliers need to modernize their operations and succeed in meeting our nation’s defense requirements,” Phelan said.
“By enabling industry to adopt AI and autonomy tools at scale, we’re helping the shipbuilding industry improve schedules, increase capacity, and reduce costs. This is about doing business smarter and building the industrial capability our Navy and nation require.”
“Palantir’s very existence is built on giving American warfighters the most dominant advantage in the world. Working with the U.S. Navy is the embodiment of our mission. And ShipOS arms the welders, engineers, and logisticians inside America’s marine industrial base with the software they deserve. ShipOS is our commitment to the sailors who defend us, the workers who equip them—and to the country we are privileged to serve,” said Karp.
“This initiative equips industry with the digital capabilities needed to deliver at scale,” said Matthew Sermon , Direct Reporting Program Manager for the Maritime Industrial Base Program.
“By supporting our industrial base with these tools, we’re helping them modernize operations, expand capacity, and sustain America’s maritime advantage.”
During pilot deployments, these AI-powered capabilities demonstrated transformative results, according to the navy.
At General Dynamics Electric Boat, submarine schedule planning was reduced from 160 manual hours to under 10 minutes, while Portsmouth Naval Shipyard cut material review times from weeks to under one hour. These early outcomes demonstrate that integrating AI and autonomy directly into shipbuilding operations can dramatically improve efficiency, accuracy, and output, it was highlighted.
The initial investment will focus on Submarine Industrial Base shipbuilders, shipyards, and critical suppliers. The navy stated that expansion beyond the Submarine Industrial Base will be systematic and informed by lessons learned, with the navy validating approaches and developing proven implementation strategies that can be adapted for surface ship programs.
The software will initially be deployed across two major shipbuilders, three public shipyards, and 100 suppliers across the MIB.
This initiative is designed to deliver measurable cost savings over time through improved schedules, reduced delays, and increased production efficiency, with productivity gains offsetting the initial investment while establishing a more capable and resilient industrial base.