8 March 2024 (Lloyd's List) - SOUTH Korea is doubling down on efforts to dominate next-generation shipbuilding, unveiling an ambitious public-private plan to invest nearly $7bn over five years.
The massive outlay aims to catapult the country’s yards ahead of emerging competitors, particularly from China, in developing cutting-edge technologies such as autonomous and zero-emission ships.
The ramped-up strategy comes after Seoul first outlined the “K-Shipbuilding Strategy for Next-Generation Market Dominance” last November, setting the goal of capturing over 80% of future shipbuilding centred on “eco” and smart vessels.
The Ministry of Trade, Industry and Energy this week launched the so-called K-Shipbuilding Next Generation Initiative, a platform for public-private co-operation to discuss industry transformation directions and strategies, according to a statement.
The ministry also signed an agreement with the country’s three largest shipbuilders — HD Korea & Shipbuilding & Offshore Engineering, Samsung Heavy Industries and Hanwha Ocean — that they will together invest Won9trn ($6.8bn) over the next five years to grab the commanding heights in the race with foreign competitors.
It also agreed to set up a road map for the country to top the development of cutting-edge technologies in the sector, including building the world’s first liquefied hydrogen carrier by 2030 and lead the international standard for autonomous ships.
To tackle a shortage of manpower at shipyards, the government now also pledges to establish a system to forecast labour supply and demand, and to train 2,000 shipbuilding professionals and workers domestically each year.
Support will also be given to the three major builders to operate capacity overseas, the statement added.
It noted that South Korean builders remain in the pole position in high-value ship market, securing 60% of the orders in 2023, although “the gap with China is gradually narrowing”.
“China has recently overtaken South Korea in terms of market share of eco-friendly ships,” the ministry warned, referring to vessels burning alternative fuels.
According to Clarksons’ data, Chinese yards won new orders for 27 alternative-fuel ships in January 2024, accounting for 52% of global total in cgt terms, followed by their peers in South Korea (41%) and Japan (1%).
The lead was largely supported by the 12 methanol dual-fuel 13,000 teu containerships placed in China by Ocean Network Express, which traditionally preferred South Korean yards.
“The challenges facing the domestic shipbuilding industry go beyond the level of individual companies and must be overcome through teamwork between the public and private sectors,” said industry minister Ahn Duk-geun.
