Korean shipbuilders are struggling.

Their world market share fell 27 percent in the first six months of this year, a sharp drop from the 40 percent recorded in 2011 according to data from B-S Financial Group.

Chinese shipbuilders have filled the gap, taking advantage of their cheaper prices.

Korea’s Hyundai Heavy Industries has been fighting back, trying to boost orders of their so-called “eco-ships” or ships that come equipped with energy-efficient technology.
Korea’s Daewoo Shipbuilding and Marine Engineering has followed a similar course producing mega-sized container ships that use 20 percent less fuel and emit 30 percent less carbon.
But despite these efforts, China has led the shipbuilding sector since 2012, grabbling a 44 percent world market share in the first half of this year.

“The Chinese government is rigorously lending support to the country’s shipbuilders by providing subsidies. It also pays some 30 to 40 percent of the cost of new orders to local shipping companies that are replacing their aging vessels with new ones.”

Underlining Korean shipyards’ difficulties, Hyundai Heavy Industries, the world’s largest shipbuilder in terms of sales, reported its worst quarterly operating loss of 1.zero-eight billion U.S. dollars for the three months to June.

Hyundai attributed its loss to a high won and provisions it set aside for potential losses from building ships, plants and offshore platforms but said its performance would improve in coming quarters.

The Korean shipbuilding industry is now eyeing new opportunities.
Hyundai Heavy recently built a factory making engines that could be used for power plants and construction equipment.
Daewoo Shipbuilding said it will put more emphasis on submarines and other defense-related vessels.