Korean Shipbuilders Anticipate Significant Order Growth in 2023
Korea’s three major shipbuilders are poised for a remarkable increase in orders this year, with projections indicating a nearly 30% rise compared to 2022. Despite a global decline in ship orders, the competitiveness of these shipbuilders in high-value vessel segments, particularly liquefied natural gas (LNG) carriers, is driving this growth. Industry insiders estimate that HD Korea Shipbuilding & Offshore Engineering, Hanwha Ocean, and Samsung Heavy Industries will collectively secure approximately $46.4 billion in new orders in 2023, marking a 27% increase from last year’s $36.3 billion. This surge is expected to surpass the previous peak of $44 billion recorded in 2022.
On January 5, HD Korea Shipbuilding & Offshore Engineering announced its order target of $23.31 billion for the year. Samsung Heavy Industries is set to reveal its target during an earnings briefing at the end of January, while Hanwha Ocean has not disclosed a specific goal. However, analysts predict that Hanwha Ocean will achieve around $12 billion in orders, while Samsung Heavy Industries is expected to reach approximately $11.1 billion.
LNG Carriers Drive Demand Amid Global Market Challenges
The LNG vessel segment is leading the charge in this year’s order growth for Korean shipbuilders. According to a report from the Korea Development Bank’s Institute for International Economic Policy, global new ship orders are projected to decline by 14.6% due to a recession in the shipping industry and other factors. Nevertheless, investment in LNG transport vessels is anticipated to rise significantly as demand for LNG surges during the global energy transition.
The report highlights that while liquefaction terminals scheduled for construction by 2029 will have a capacity of 56.5 million tons, only 21 LNG vessels have been ordered thus far. This indicates a pressing need for at least 110 additional vessels to manage the transportation demands from these new terminals, with expectations that at least 70 of these orders will go to Korean shipbuilders. The construction of LNG carriers is complex, requiring advanced technology for ultra-low temperature cargo holds, which contributes to high entry barriers in this market.
Korean shipbuilders have maintained a dominant position in the LNG carrier market, despite losing ground in the container ship and bulk carrier sectors to China. From 2021 to 2025, Korean firms delivered 248 vessels, compared to just 48 from China, resulting in an impressive 83.8% market share for Korea.
Strong Financial Outlook for Korean Shipbuilders
The financial outlook for Korea’s shipbuilding industry appears robust as LNG vessels ordered in 2022 and 2023 begin to be delivered. Typically, the construction and delivery of LNG carriers span 2-3 years. During this period, HD Korea Shipbuilding & Offshore Engineering secured orders for 83 LNG carriers, while Hanwha Ocean and Samsung Heavy Industries each received orders for 43.
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Based on these achievements, HD Korea Shipbuilding & Offshore Engineering is projected to record an operating profit of 5.852 trillion won this year. Hanwha Ocean and Samsung Heavy Industries are expected to earn operating profits of 2.609 trillion won and 1.633 trillion won, respectively. Collectively, these three companies are anticipated to achieve an operating profit of 10.124 trillion won. An industry official noted that the shipbuilding market this year will likely see LNG vessels and large gas carriers offsetting declines in container ship and tanker orders, reinforcing the sector’s resilience amid global challenges.
