South Korean shipbuilders, backed by extensive orderbooks, are weighing offshore production options as domestic shipyards operate at full capacity. With shipbuilding docks fully booked, some newly secured orders may be constructed abroad.
Amid expectations that the shipbuilding boom will persist for several more years, South Korean companies are prioritizing high-value vessel production at home while outsourcing the construction of standardized ship types to foreign partners.
Industry sources said on Feb. 17 that Hanwha Ocean, one of South Korea’s leading shipbuilders, visited India last month at the invitation of the Indian government. The company spent about 10 days touring shipyards operated by Swan Defence and Heavy Industries, Cochin Shipyard, Hindustan Shipyard, and L&T Shipbuilding. The visit followed a late-2024 trip to South Korea by an Indian delegation, which included key shipbuilding officials seeking cooperation in shipbuilding and maintenance. The delegation visited shipyards run by Hanwha Ocean, HD Hyundai Heavy Industries (HD HHI), and Samsung Heavy Industries (SHI).
Hanwha Ocean expects to maintain a three-year backlog of commercial vessel orders in 2024. The company secured nearly 40 new commercial orders last year, including 19 liquefied natural gas (LNG) carriers, six containerships, eight tankers, and five liquefied petroleum gas (LPG) carriers. Industry forecasts indicate that Hanwha Ocean’s commercial orders could surpass 2023 levels, driven by rising LNG carrier demand amid former U.S. President Donald Trump’s push to expand LNG exports. Additionally, escalating U.S. sanctions on China could redirect containership orders to South Korean firms.
With its Geoje shipyard operating at full capacity, Hanwha Ocean is exploring whether some orders could be allocated to Indian shipyards. However, India’s shipbuilding infrastructure remains a key consideration. Indian shipyards primarily construct small and mid-sized vessels and currently lack the capability for large-scale shipbuilding. The Indian delegation’s visit to South Korea reflected the country’s interest in acquiring South Korean shipbuilding expertise.
SHI has already outsourced part of its shipbuilding operations to China. In late October, it entrusted the construction of four Suezmax tankers—each valued at approximately 459.3 billion won ($319 million) and ordered by an African shipowner—to Zhoushan Shipyard in China, leveraging local facilities and labor.
SHI currently holds a backlog exceeding three years and has set a 2025 annual order target of $9.8 billion (14.14 trillion won), with $5.8 billion allocated for commercial vessels. The company plans to prioritize high-value contracts while outsourcing tanker and containership production to subcontractors.
An industry official noted that SHI, which does not manufacture defense-related vessels, can utilize Chinese facilities. In contrast, Hanwha Ocean and HD HHI, which are considering building military vessels for the U.S., are exploring potential partnerships with India instead of China.
