Chinese government has recently adjusted its strategic policy to guide its shipbuilding industry and shifted its focus to high-end market to grasp more market share. Many Chinese shipyards are now tapping into high-value and larger size shipbuilding market and pushing China to grow into the biggest shipbuilding power in the world.
China topped the table in newbuilding market last year by governing the lead of three major shipbuilding indices, especially new orders which could best illustrate future trend. However, China is only big enough to win the statistics race but not strong enough to keep its crown in the increasing competitive market.
In the last few years, bulker has been the hottest type in newbuidlng and dominated China’s new orders, while Korean and Japanese shipyards turn to high value ship types for survival in the financial crisis. However since the beginning of 2011 shipbuilding market has undergone dramatic demand changes in ship types.
Containerships (especially large-size) and offshore new orders have surged to lead the pack and push the international market to attach more importance to technology, brand and quality. On the contrary, the bulk carrier new orders are heavily struck by overcapacity and sluggish dry shipping market. The terrible freight rate, declining newbuild price and increasing losses have jointly driven Chinese shipbuilding industry to rapid fall.
High-tech, high-value and environmental-friendliness are the way out for Chinese shipbuilding to realize industry transformation.
On one hand, Chinese shipyards have to optimize product structure by upgrading building technology of bulkers, tankers and containerships. On the other hand the yards could march into high-end market for new development vitality and support, such as mega LNG carriers, LPG carriers, offshore plants, ect.
Apart from greater R&D investment, Chinese shipyard would have to upgrade its management to match modern shipbuilding mode. Instead of focusing on capacity investment, the shipyards should pay more attention to improve production efficiency and refine management capability. Meanwhile, the industry should take into the overall human resources development into account to strengthen the root for growing high-end shipbuilding industry.
There is a popular saying in China – to gain mastery by striking only after the enemy has struck. Maybe China would take high-end market as the leading card to take the lead again even Korea and Japan now dominate the sector. It only takes time.