A Strategy for Localization and Commercialization of Equipment and Materials:The Crux of the Paradigm Shift in Shipbuilding

The shipbuilding equipment and materials (E&M) industry can play a crucial role in the paradigm shift occurring in the shipbuilding sector, dominated by the transition to smart and eco-friendly vessels. An aggressive strategy for localization and commercialization of shipbuilding E&M is essential to bolstering the shipbuilding industrial ecosystem in Korea. The influence of shipowners (shipping companies) is absolute in decisions on whether to use local E&M on a given vessel. A vendor wishing to make it on a company’s maker list requires a track record and high product reliability, something any strategy must consider. Korean E&M manufacturers are mostly small in scale and limited in life-cycle service capability, from investment in R&D to certification, inspection, production, marketing, and customer service. Meanwhile, global E&M vendors have grown into market leaders through a phased approach utilizing M&A, strategic partnerships, joint ventures with global companies, and cooperation with upstream and downstream industries. Korean manufacturers must follow these trends and assume a multi-perspective strategy to improve competitiveness. This paper explores ways through which Korean government might provide effective support measures for life-cycle E&M, a sector in which domestic players are weak. Such support will include enabling better access to information, alongside aid for technological development, certification and inspections, marketing and customer service platforms, and guaranty insurance. Such efforts will allow for import substitution of core E&M products and stimulate market expansion, thereby helping maintain and reinforce the global competitiveness of Korean shipbuilding.