By Li Cheng

Road of becoming strong for Chinese shipbuilding industry

By Li Cheng

In the revitalization process of China's shipbuilding industry, enterprises not only need to face further upgrading of the shipbuilding industry and fierce competition in core technology, financial support in key areas, and continuous conquer through intelligence and changes,but also need to cultivate the world’s first class monopoly enterprises, this is indispensable means.

In this respect, the Chinese shipbuilding industry should pay attention to several aspects of the high-end needs: 1, the rapid development of LNG transport ship demand led by liquefied natural gas trade. 2, the need for large tankers caused by the changes of the pattern of oil trade. 3, the expectation that the trend of large-scale container ship will remain unchanged for a period of time. 4, the policy of the Belt and Road Initiatives’ impact on trade and the construction of ports. 5, the confirmation of coming into force of the sulfur emission restrictions in 2020 which make it more difficult for ship manufacturing. 6, the cruise becomes a new hot spot.

China's ship industry relies on the stamina of development and the key point is that China must upgrade in the industry, which is also related to Chinese economy transferring successfully to the next stage of sustainable and balanced stage. In fact, the most critical issue is the adoption of new strategies under the premise of economies of scale and technological innovation thus transforming rigid mechanisms and integrating the whole shipbuilding industry chain.

1, The important strategy of China's shipbuilding industry transformation and upgrade. The strategy of grasping the key core technology and exchanging technology with the market. With core technology and monopoly market, China's high-speed rail enterprises are now ranked as the world's first class,China's shipbuilding industry should learn from them.Exchanging market with cooperation is an important way. Today, Russia, the Middle East, the United States and other countries generally build their ships by themselves and this requires Chinese shipbuilding industry to adopt new strategy.

2, China's shipbuilding industry needs to cultivate the world's first class monopoly enterprises. The role of monopoly competition in the development of the world's shipbuilding industry is obvious and world-class monopoly enterprises have absolute advantages in terms of scale of economies. Monopolistic competition has became more and more obvious recently. According to Clarkson’s april 2011 statistics, the first class enterprises in the world - the world's top four ship manufacturing enterprises accounted for 25% of the world's handheld orders, the world's top 17 shipbuilding enterprises accounted for 50% of the world's hand-held orders, the top 48 shipbuilding enterprises accounted for 75% of the hand-held orders, while other 364 small shipyards accounted for only 10% of the share.

The shipbuilding industry is an industry with a relatively obvious large scale of economic efficiency, which is already evident in a highly integrated monopolistic competitive international ship market. China's shipbuilding industry must be fully aware that in a highly internationalized ship market, large enterprise groups have a clear advantage in market competition.As the international shipping market monopoly trend is still further increasing, thus China should cultivate the world's first class large enterprises and participate in the international shipbuilding industry monopoly competition which has become indispensable means for China's shipbuilding industry.