Global shipbuilding industry has been affected by the raging European crisis till now. The whole shipbuilding industry is seeing changes in competition and in revenue sources in its fight with the turmoil.
As the new-rising star in global shipbuilding market, China has emerged as one of the world leaders in shipbuilding due to its lower costs of materials and labor. However, the proportion of speculative orders in its huge orderbook has come all the way with its growth in the shipbuilding industry itself. It is rumored Chinese buyers would place a significant order for new crude-oil tankers recently. Those speculative orders would support employment in the country’s shipbuilding industry and give more confidence to the overall market.
However, resources project that the current slump will affect the Chinese shipbuilding industry more than it will affect the South Korean shipbuilding industry. Although China is enjoying great support from its government, its relevantly single ship-product structure and diminishing advantages in labor and material will make it lag behind in future market.
Mainly big shipyards in China are now trying to made optimization and upgrade in its products and management to keep its share in the industry. Moreover, its endeavor in the development of new ship types and new sectors would support its standing in global shipbuilding industry.
At the same time, the European Crisis is hitting South Korea’s shipbuilding industry pretty hard. South Korean shipbuilding stocks market has seen jump as much as 80 percent in four months. However, the slowdown may affect Korean shipyards less than those in China as its shipbuilders including the Big Three have shifted part of their reliance on these traditional markets to those energy-saving and high-value-added products. Besides, according to NH Investment & Securities, South Korean yards have turned to energy-related products recently and are estimated to gain more from energy products than ships.
As the past leader of shipbuilding industry, Europe is doing its best to keep up with the global competition. Recently, the European Union unveiled new rules for assessing aid to the bloc’s shipbuilding industry, hailing the reform as intended to help foster innovation. These new rules will come into affect at the beginning of 2012.