Global Shipbuilding Market Outlook to 2028

Global Shipbuilding Market Overview

• The Global Shipbuilding Market is valued at USD 150 bn, based on a historical 5 year analysis. This growth is driven by rising maritime trade, advancements in shipbuilding technology, and increasing demand for energy-efficient vessels. Investments in naval defense and offshore exploration also contribute significantly to market expansion.

• China, South Korea, and Japan dominate the global shipbuilding market due to their well-established shipyards. China leads with cost-efficient production capabilities, while South Korea specializes in LNG carriers and mega-container ships. Advanced infrastructure and government subsidies support these regions' dominance.
• In 2023, the International Maritime Organization (IMO) adopted a resolution targeting "dark fleet" tankers engaged in illegal and unsafe activities at sea. These vessels, often operating for sanctioned nations like Iran and Russia, pose significant risks due to their age and condition. The resolution urges flag states to enforce measures regulating ship-to-ship transfers and other clandestine operations.

Global Shipbuilding Market Segmentation

• By Application : The Global Shipbuilding Market is segmented by application into cargo transportation, passenger travel, offshore energy production, military and defense and others. Cargo transportation dominates this segment due to increasing global trade and demand for large container ships. This growth is supported by innovations in ship design and optimization for fuel efficiency.

• By Region : Geographically, the market spans Asia-Pacific, Europe, North America, Latin America, and Middle East & Africa. Asia-Pacific holds the largest share, driven by its cost-effective production and significant investments in advanced shipbuilding technologies. North America is the emerging region, it focuses on naval shipbuilding due to its strong defense sector.

• By End User: The Global Shipbuilding Market is bifurcated into transport companies, military, and other end-users. The increasing volume of global trade is one of the primary drivers for the growth of the commercial shipbuilding market. Shipping companies are continuously looking to modernize their fleets to improve efficiency, reduce operational costs, and enhance cargo capacity.

Global Shipbuilding Market Competitive Landscape

The Global Shipbuilding Market is dominated by major players such as Mitsubishi Heavy Industries Ltd, Hyundai Heavy Industries Co. Ltd, and China State Shipbuilding Corporation. These companies leverage advanced R&D, technological innovations, and strategic collaborations to maintain their competitive edge. They benefit from government subsidies and strong global networks.

Global Shipbuilding Industry Analysis

Growth Drivers

• Increasing Maritime Trade Volume: Global maritime trade volumes surpassed 12 billion tons in 2023, according to the United Nations Conference on Trade and Development (UNCTAD), with over 80% of world trade carried by sea. The Port of Shanghai handled over 47 million TEUs of containerized cargo in 2023, showcasing the reliance on maritime transport for global commerce. This surge in trade drives demand for advanced vessels.
• Technological Advancements in Vessel Design : Technological innovations in the global shipbuilding market are transforming the industry with advancements in fuel efficiency and eco-friendly designs. Shipbuilders are adopting cleaner propulsion systems and digital simulation tools to enhance vessel performance and streamline production. These innovations are improving operational efficiency, reducing emissions, and aligning with evolving environmental regulations, driving the industry's shift toward sustainability.
• Government Investments in Naval Defense : Governments worldwide are increasing investments in naval defense to address security concerns.The U.S. Department of Defense allocated $32 billion for shipbuilding in 2023, which includes the procurement of six new ships. India launched its indigenous aircraft carrier INS Vikrant with an investment of $3 billion. These projects highlight the critical role of shipbuilding in national security strategies.

Challenges

• High Initial Capital Investment : Shipbuilding demands significant financial resources for infrastructure, advanced technology, and skilled labour. Establishing a shipyard requires substantial capital, and ongoing maintenance further adds to operational expenses. These high investment requirements create barriers to entry, making it challenging for smaller manufacturers to compete with established industry players who have greater financial capabilities.
• Environmental Regulations Impacting Shipbuilding Processes : Stringent environmental regulations are driving higher compliance costs in the Global Shipbuilding Market, pushing manufacturers to adopt cleaner technologies. Shipbuilders are investing in eco-friendly propulsion systems and emission-reduction solutions to meet regulatory standards. The shift toward sustainable vessel designs increases production complexity and costs, requiring companies to balance innovation with operational efficiency while maintaining profitability in a competitive industry.

Global Shipbuilding Market Future Outlook

The Global Shipbuilding Market is set for growth, driven by increasing maritime trade, technological advancements in vessel design, and expanding naval defense investments. While challenges such as high capital requirements and stringent environmental regulations persist, opportunities in offshore wind energy projects and autonomous vessels offer significant potential, aligning with sustainability goals and the evolving demands of global maritime operations.

Opportunities

• Expansion in Offshore Wind Energy Projects : By 2028, offshore wind energy projects will drive demand for specialized vessels to support construction and maintenance in the global shipbuilding market. Shipbuilders will focus on designing advanced installation and service vessels to meet the needs of expanding offshore wind farms. As governments increase investments in renewable energy, the industry will see significant opportunities for innovation and fleet expansion.
• Demand for Autonomous Vessels : Autonomous vessels are gaining traction due to advancements in artificial intelligence and automation. Japan is making significant advancements in autonomous shipping through theMEGURI2040 Fully Autonomous Ship Project, which aims for full-scale commercialization of autonomous ship technology by2025. These developments reflect a growing market for smart, efficient maritime transport solutions.