ULSAN < invest Korea

According to Pulse by Maeil Business News Korea,

Hyundai Heavy Industry Co. is operating its main shipyard to full capacity as the world’s biggest shipbuilder is working through three years of order backlogs as the industry has emerged from a long and harsh winter.

All nine docks were in operations working on high-value-added ships, like liquefied natural gas carriers, at the company’s shipyard in Ulsan, about 300 kilometers southeast of Seoul, when Maeil Business Newspaper visited on Wednesday.

The shipbuilder’s orderbook is now packed for the next three years, and it’s in need of some 2,000 to 3,000 additional workers to handle the entire process from design to delivery. Recent government support to shipbuilders is helping to ease the labor shortage.

In one dock, workers and cranes are working non-stop to build a 299-meter long, 46.4-meter wide and 35.5-meter high LNG carrier. The vessel’s height is the same as a 14-story building.

“We started the building process on this vessel in November 2020,” said Lee Man-soo, the shipyard’s general manager for shipbuilding. “We will conduct a sea trial of the ship on April 16 and delivery is scheduled for June.”

The LNG carrier will be delivered to a U.K. customer that ordered the vessel for $250 million. The vessel can carry up to 174,000 cubic meters of LNG, an amount that can power all of Korea for half a day.

Rapidly growing Chinese shipbuilders do not pose a threat the company as it has built-in confidence from its strengths in high-value-added vessels. Chinese shipbuilders mostly seek orders for low-end bulk carriers. Of the total 155 ships in its orderbook, 53 are LNG carriers. Since its establishment in 1972, the shipbuilder has built 95 LNG carriers out of a total 2,272.

“Hyundai Heavy, Hyundai Samho Heavy Industries Co. and the Hyundai Mipo Dockyard Co. are all working on developing vessels that can be powered by environmentally-friendly fuels like methanol, ammonia and hydrogen,” said Ka Sam-hyun, vice chairman of the Korea Shipbuilding & Offshore Engineering Co., the parent of Hyundai Heavy. Hyundai Heavy is also focusing on developing technologies for fuel reduction and cargo containment.

“A vessel consumes fuel that costs some 100 million won a day,” Lee said. “Our vessels have systems to save fuel, leading to a 10 percent to 15 percent lower fuel cost.”

Hyundai Heavy’s air lubrication system helps to reduce frictional resistance by providing air across the bottom of the hull, thereby reducing both fuel consumption and carbon emissions, the company said.

Hyundai Heavy is also enthusiastic about the development of cargo containment systems, with KC-2 that is soon to be released. The follow-up model of the LNG cargo containment system KC-1 has enhanced insulation and cooling features, can be easily installed and has a lower boil-off gas rate driven by natural vaporization.

Since its first LNG carrier in 1994, Hyundai Heavy has kept the industry’s global top position. The shipbuilder plans to find a breakthrough to its labor shortage through aggressive employment policies. Vice Chairman Han Young-seuk said the shipbuilder plans to hire more foreign workers at Hyundai Heavy, Hyundai Samho, Hyundai Mipo and other affiliates, up to 2,800 workers, rfrom the current 800 workers.

Domestic workers are also being actively sought, particularly given that shipbuilding is one of the country’s key industries and constantly requires highly-skilled professionals. “Thanks to the recent government intervention concerning labor shortage, work sites are now gaining some momentum. We’ll also hire 200 to 300 workers from home,” Han said.

Korea Shipbuilding, the holding company of HD Hyundai Group’s shipbuilding units, has won orders for 49 vessels this year, worth $6.51 billion. It has met 41.4 percent of its target of $15.74 billion for this year.

Hyundai Heavy’s sales target this year is 12.1 trillion won ($9.29 billion) and it hopes to have $11.8 billion in orders and plans to deliver 46 vessels.


By Seong Seung-hoon and Chang Iou-chung

Copyrights Pulse by Maeil Business News Korea. All Rights Reserved.

Source: Pulse by Maeil Business News Korea (Mar. 27, 2023)