A sixty-year perspective on total shipbuilding output clearly shows how the business first moved from Europe to Japan, then to South Korea, and now China has taken pole position.
Since 1950 the main factor has been lower production costs. In most cases, changes have coincided with lower-cost nations’ build-up of their industrial base. Shipbuilding is seen as a strategically important industry in many countries. Japan made the move in the 1950s, South Korea in the late 1980s and China in the 2000s. There is nothing that indicates that the big three nations in shipbuilding output will change within the next 10 years.
Figure 1: Share of deliveries to the world fleet, 1970-2027, dwt
The current orderbook is dominated by large container carriers, tankers and bulk carriers, most of which to be built in China and South Korea. South Korea has most of the orders for the construction of complex high-value LNG tankers.
The Chinese orderbook is dominated by container and bulk carriers, South Korea’s by container carriers and tankers, while Japan’s is mostly about bulkers. European builders still dominate the construction of high-end cruise ships.
The ratio between the size of the orderbook and the size of the fleet gives an idea of the forward cover. Whilst the total fleet ratio hovers around a historically low 10% level, it is much higher for LNG tankers, container carriers, cruise and LPG.
Figure 2: Total orderbook at year-end, M dwt, and the percentage of the total fleet (blue line)
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