Samsung Heavy Industries’ Geoje shipyard , which is running out of capacity due to a surge in orders, is seeking to expand its global shipbuilding base by partnering with overseas shipyards and is interested in entering shipyards in Vietnam and Indonesia.
Recently, Samsung Heavy Industries posted a job announcement to recruit talented individuals with extensive experience in “global operations and production management”. The announcement specifies “Vietnam and Indonesia” as the hiring locations and gives preference to candidates with experience in global operations in these regions.
Based on low production costs (including labor) and location advantages, Samsung Heavy Industries wants to cooperate with Southeast Asian shipyards in order to speed up shipbuilding by using local docks and piers. Samsung Heavy Industries plans to build high value-added ships such as liquefied natural gas (LNG) carriers and offshore projects at the Geoje Shipyard, while the rest of the general merchant ships will be built using overseas shipyards.
For the Southeast Asian market, Samsung Heavy Industries has long been laying out a plan, but the first thing to be solved is the shortage of manpower in shipyards. In November 2023, Samsung Heavy Industries signed a Memorandum of Understanding (MOU) with the East Java Provincial Government of Indonesia to provide a vocational training program for shipbuilding welders to meet Samsung Heavy Industries’ demand for skilled manpower in Fusion Cored Arc Welding (FCAW).
In October 2023, Samsung Heavy Industries signed a memorandum of understanding with Thuyloi University, Vietnam, aiming to provide shipbuilding training and professional technical exchanges to lecturers and students of Thuyloi University. The main contents include: dispatching human resources and technology, expanding employment, improving technical levels, and strengthening human resources exchanges.
In terms of expanding overseas shipyards, Samsung Heavy Industries is currently outsourcing ordinary commercial ship orders to Chinese shipyards for construction. Since the end of last year, Samsung Heavy Industries has outsourced eight 158,000 DWT Suezmax tanker orders to PaxOcean Engineering Zhoushan. Samsung Heavy Industries will be responsible for the design, guarantee, equipment and material procurement of the new vessels, while PaxOcean Engineering Zhoushan will be responsible for the construction. The eight new vessels come from Greek shipowners Centrofin and Greek Dynacom Tankers, with four vessels each.
However, as the United States imposes port fees on Chinese-built ships, the South Korean industry expects Samsung Heavy Industries to accelerate the expansion of shipbuilding bases outside of Chinese shipyards, such as in Southeast Asia.
As of April 28 this year, Samsung Heavy Industries has taken orders for 18 new vessels worth about US$2.6 billion, achieving about 26.5% of its annual order-taking target of US$9.8 billion, including one LNG carrier, nine shuttle tankers, two VLECs, four oil tankers, and two container ships.