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China’s shipbuilding progress threatens South Korea’s long-held tech dominance in the industry

  • While China holds a commanding lead in total container vessels produced, South Korea makes more advanced and expensive carriers for liquefied natural gas (LNG)
  • Whosever shipbuilding industry comes out on top is expected to be determined by which country better uses automation and AI technologies

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A liquefied natural gas (LNG) carrier is built in Geoje, South Korea. Photo: Getty Images
Erika Na
Even as August marked an end to its months-long stretch with the biggest share of the world’s shipbuilding industry, South Korea still celebrated the fact that it managed to snatch up all eight of the month’s orders for advanced and expensive ships that carry liquefied natural gas (LNG)
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So, while China climbed to a 14 percentage point lead over South Korea in the overall shipbuilding market, the technological edge still goes to the latter.

But some analysts say China is starting to catch up on the tech side, on top of having already overtaken Korea by volume. And to become more competitive, they argue, Korea must adapt by resetting its industrial strategies to fit the fast-changing global market conditions.

Relying too much on a single item – LNG carriers – to maintain its competitiveness puts South Korea in a more difficult position to respond to changes in the industry, the experts warn.

In the future, they contend, the competition between China and South Korea will ultimately be decided by which country can better apply automation and AI technologies to their shipbuilding process.

For the last several years, South Korea and China have been jostling for position in the shipbuilding market, and there have been short and lengthy periods in which both held leads.

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