South Korean Shipbuilders Expand Global Operations
As demand for green shipping solutions and military naval modernization surges, South Korean shipbuilders are strategically extending their operations beyond domestic shores. Major players in the industry, including HD Korea Shipbuilding & Offshore Engineering Co. (HD KSOE), Hanwha Ocean Co., and Samsung Heavy Industries Co., are leveraging overseas dockyards to meet increasing order volumes. This shift comes amid a favorable market environment driven by geopolitical tensions and evolving trade dynamics.
Strategic Moves in Southeast Asia
With domestic shipyards reaching full capacity, South Korean shipbuilders are increasingly turning to Southeast Asia and the Middle East for vessel construction. This strategic pivot aims to maintain a competitive edge against rivals, particularly in light of the ongoing trade war between the United States and China. The U.S. Navy’s efforts to enhance its defense capabilities in collaboration with allies further bolster the prospects for Korean shipbuilders.
Recently, HD KSOE secured an order for four 115,000 deadweight tonnage (DWT) crude oil tankers from Hong Kong-based Cido Shipping. Notably, these vessels will be constructed at the Subic Shipyard in the Philippines, which has been revitalized after ceasing operations in 2019. The shipyard, located approximately 110 km northwest of Manila, was acquired by Cerberus Capital Management L.P. and is now operational under HD KSOE’s management. The company has begun utilizing the facility for various projects, including the construction of ship blocks and offshore wind platforms, while also providing maintenance services for the Philippine Navy.
In Vietnam, HD Hyundai Mipo’s subsidiary is undergoing significant expansion, aiming to increase its production capacity by 50% by 2030. The yard, which primarily builds Aframax-class tankers, is responding to a surge in orders from European and African shipowners. To support this growth, the company is investing over 100 billion won ($70.4 million) to construct an additional dock.
Expanding Footprints in the U.S. and Beyond
Hanwha Ocean, formerly known as Daewoo Shipbuilding & Marine Engineering, is also making significant strides in expanding its international presence. The company recently acquired a 100% stake in Philly Shipyard Inc., marking a historic entry into the U.S. shipbuilding market. Additionally, Hanwha has initiated a public tender offer for Singapore’s Dyna-Mac Holdings Ltd., aiming to fully integrate the offshore equipment manufacturer into its operations. Currently, Hanwha plans to construct seven vessels at Philly Shipyard and has a backlog of 29 topside modules at Dyna-Mac, indicating a robust commitment to offshore platforms and energy infrastructure.
Meanwhile, Samsung Heavy Industries is actively subcontracting work in China, having recently delegated the construction of four crude oil carriers to PaxOcean. This approach allows Samsung to meet tight delivery schedules while optimizing resource allocation. The company is also exploring new partnerships in Southeast Asia to diversify its operations amid rising geopolitical tensions and cost challenges.
As the global shipbuilding landscape evolves, South Korean firms are positioning themselves to capitalize on emerging opportunities, ensuring they remain competitive in a rapidly changing market.
