South Korean shipbuilders are likely to be outpaced this year by Chinese competitors with surging freight demand, government subsidiaries and cheap labor.
It will be the first time that Korea, home to seven of the world’s top 10 shipyards, will have lost the No. 1 slot since 2003, when it finished behind Japan.
According to Clarkson Research Services, a London-based market researcher, the total completed shipbuilding volume of Korean shipyards stood at 13.36 million compensated gross tons in the first 10 months of the year, compared to Chinese firms’ 14.8 million CGTs.
The market share of Korea and China for that category was 31.8 percent and 35.3 percent, respectively.
Local shipbuilders also fell behind their Chinese counterparts in the number of new orders they won during the 10-month period.
Korean firms won a combined 9.81 million CGTs of orders, which accounted for 37.9 percent of the global total, while their Chinese rivals clinched 11.7 million CTGs, which took up 45.3 percent of the world’s total.
Korean shipyards’ order backlogs came to 45.39 million CGTs as of Nov. 1, far lower than that of 51.67 million CGTs for Chinese shipbuilders, according to Clarkson.
Despite the financial crisis, the Chinese shipbuilding industry has grown exponentially over the past few years, thanks to cheap labor, government support and technological development.
“In light of the current trend, it is almost certain that China will overtake Korea and emerge as the world’s largest shipbuilding country this year,” an industry source said. “China has a lot of small and medium-sized shipyards, most of whose orders are coming from within the country.”
It will be the first time that Korea, home to seven of the world’s top 10 shipyards, will have lost the No. 1 slot since 2003, when it finished behind Japan.
According to Clarkson Research Services, a London-based market researcher, the total completed shipbuilding volume of Korean shipyards stood at 13.36 million compensated gross tons in the first 10 months of the year, compared to Chinese firms’ 14.8 million CGTs.
The market share of Korea and China for that category was 31.8 percent and 35.3 percent, respectively.
Local shipbuilders also fell behind their Chinese counterparts in the number of new orders they won during the 10-month period.
Korean firms won a combined 9.81 million CGTs of orders, which accounted for 37.9 percent of the global total, while their Chinese rivals clinched 11.7 million CTGs, which took up 45.3 percent of the world’s total.
Korean shipyards’ order backlogs came to 45.39 million CGTs as of Nov. 1, far lower than that of 51.67 million CGTs for Chinese shipbuilders, according to Clarkson.
Despite the financial crisis, the Chinese shipbuilding industry has grown exponentially over the past few years, thanks to cheap labor, government support and technological development.
“In light of the current trend, it is almost certain that China will overtake Korea and emerge as the world’s largest shipbuilding country this year,” an industry source said. “China has a lot of small and medium-sized shipyards, most of whose orders are coming from within the country.”