When U.S. President Donald Trump met with Korean President Lee Jae Myung in Washington on Aug. 25, he didn’t start with security or trade — he opened with shipbuilding.
“They build them very well in South Korea,” Trump said. “We’re going to be buying ships from South Korea, but we’re also going to have them make ships here, using our people,” he said, adding that the United States wants to get “back into the shipbuilding business again.”
Trump is familiar with the strength of Korea’s shipbuilding industry. During a 1998 visit to Daewoo Shipbuilding & Marine Engineering’s Okpo Shipyard in Geoje, South Gyeongsang, he reportedly climbed a Goliath crane towering nearly 100 meters (328 feet) high and exclaimed “wonderful” after seeing multiple large vessels under construction simultaneously.
The rise of “K-shipbuilding” as a potential partner in the U.S. shipbuilding renaissance is viewed as a result of both public and private sector efforts in Korea. Shin Dong-shik, 92, chairman of the Korea Maritime Consultants and former senior presidential secretary for economic affairs under the Park Chung Hee administration, is credited with planting the seeds.
Based on advanced technologies and industrial policy he learned while studying in the United States in the 1960s — then a shipbuilding powerhouse — Shin drafted a mid- to long-term plan for Korea’s shipbuilding industry that led to the groundbreaking of the Okpo Shipyard in 1973.
Around the same time in Ulsan, Hyundai Group founder Chung Ju-yung (1915-2001) launched a private shipyard initiative. In an unprecedented move, Chung requested a loan from Barclays Bank in Britain, presenting a 500 won ($0.30) bill printed with an image of a turtle ship. He simultaneously secured an order for two very large crude carriers from Greece using only a photo and blueprint of the shipyard site. It was a bold challenge with no precedent.
Korea’s shipbuilding industry soon began to outpace advanced rivals by leveraging two core advantages: speed and cost. Breaking from tradition, Korean shipbuilders introduced the “multiship, single-dock” method, distinguishing themselves from Japan.
Korea’s global market share for ship orders jumped from 1.3 percent in 1973 to 19.2 percent in 1983. That same year, HD Hyundai Heavy Industries overtook Japan’s Mitsubishi Heavy Industries to become the world’s No. 1 shipyard by output. By 1993, Korea commanded 46.4 percent of the global shipbuilding market.
More recently, faced with fierce competition from Chinese shipbuilders, Korean companies have shifted focus to high-value-added vessels, particularly liquefied natural gas (LNG) carriers. Just two days after the recent Korea-U.S. summit, Hanwha Group — which operates Philly Shipyard in the United States — placed an order for an LNG carrier via Hanwha Shipping.
The move signaled an intent to revive U.S. shipyards while boosting their capability to build high-tech vessels. Of the 760 LNG carriers currently in operation globally, about 70 percent were built in Korea — making it the world’s leading LNG shipbuilder.
However, a critical component of LNG carriers is the cargo containment system, which liquefies gas at extremely low temperatures and high pressure. The original technology is held by the French engineering company Gaztransport & Technigaz (GTT), which receives about 5 percent of a vessel’s price as royalty.
In August, the Korean government announced plans to support the development of a domestic alternative to a cargo containment system dubbed KC-2.
“To catch up with GTT, whose technology is backed by experience across many vessels, Korea needs to guarantee orders, build a proven record and gain market recognition,” said an industry official.
Another opportunity lies in the icebreaker LNG carrier market, which is growing in line with U.S. efforts to accelerate LNG development in Alaska. Observers say orders are likely for carriers capable of breaking through Arctic ice, offering Korean builders a strategic edge.
On Monday, HD Hyundai announced it had developed AI-based cargo tank management technology for LNG carriers and would begin pilot testing. Hanwha Ocean, which in 2016 became the world’s first builder of an icebreaker LNG carrier, then known as Daewoo Shipbuilding & Marine Engineering, holds the record for the most orders in this segment with 21 vessels. Samsung Heavy Industries has also previously delivered five icebreaker oil tankers to Russia.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
Source: Korean JoongAng Daily