Top 5 Shipbuilding Companies in the Philippines: A Detailed Comparison

shipbuilding companies in the Philippines
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The Philippines has become an emerging hub for shipbuilding in Southeast Asia. With its strategic location, skilled workforce, and government support, the country’s shipbuilding industry has seen rapid growth over the past decade.

This article provides an in-depth comparison of the top 5 major shipbuilding companies in the Philippines. We analyze key factors like years in business, production capacity, ship types, clients, and notable projects for each company. Read on to find out who is leading the pack in Philippine shipbuilding.

An Overview of the Shipbuilding Industry in the Philippines

But first, let’s look at what’s driving growth in the Philippine shipbuilding and maritime sector:

  • Strategic location – the country is at the nexus point of major shipping routes in Asia. This geographic advantage leads to strong demand.
  • Government support through incentives like tax holidays and import duty exemptions on capital equipment. These policy mechanisms make the Philippines cost competitive.
  • Availability of skilled labor at an affordable cost. Filipino craftsmanship has earned global recognition.
  • Increasing compliance with international quality standards like ISO 9001. This pushes local shipyards to be more quality focused.

According to the Philippine Association of Marine Industries Inc (Pami), the country is currently the 4th largest shipbuilder globally in terms of new orders.

The industry directly employs over 100,000 skilled workers and indirectly supports another 250,000 jobs. It contributes nearly Php 60 billion annually to the economy based on Pami estimates.

So which players are leading this fast-growing industry? Let’s analyze the top 5 shipbuilding companies in the Philippines.

Comparison Table of Top 5 Shipbuilding Companies in the Philippines

CompanyYears in BusinessProduction CapacityShip TypesKey ClientsNotable Projects
Tsuneishi Heavy Industries (Cebu), Inc.21 years275,000 DWT per yearBulk carriers, chemical tankers, containerships, etc.Mitsui OSK Lines, Nippon Yusen KaishaCebu Queen
Hanjin Heavy Industries and Construction Philippines10 years200,000 DWT per yearLPG carriers, bulk carriers, containershipsSK Gas, Bergen Tankers, Wan Hai Lines– Built 83 ships worth $1.8B
– Among Top 5 in gas carrier builders globally
KEPPEL Philippines Marine15 years50,000 DWT per yearTug boats,offshore support vesselsCompleted first LNG powered tug in 2020
Herma Shipyard37 years10,000 DWT per yearPassenger vessels, RoRo ships2Go Travel, Logistics SupportMV St. Braquiel, biggest Philippine commercial boat
Propmech Corporation10 years5,000 DWT per yearLanding craft transport, passenger vesselsPhilippine Government, etc.

Now let’s look at detailed profiles of each in the top 5 shipbuilders in the Philippines list:

1. Tsuneishi Heavy Industries (Cebu) Inc.

Tsuneishi is the leading shipbuilder in the country with over 20 years of operations in Cebu province. They have delivered over 175 ships amounting to millions of gross tonnage.

The Tsuneishi Group from Japan established the subsidiary in the Philippines in 1997 through joint venture with Aboitiez Group. Their shipyard is spread across 93 hectares and employs 8,000 skilled workers.

Production Capacity: Tsuneishi has the highest capacity to produce 275,000 gross tonnage annually. They have large dry docks, painting facilities and machine shops.

Key Ship Types: Bulk carriers, container ships, chemical tankers, oil tankers, landing craft transports, RoPax ferries etc. They are experts in building mid-sized ocean going vessels.

Major Clients: Tsuneishi’s global clientele includes names like Mitsui OSK Lines, Nippon Yusen Kaisha, Hapag Lloyd etc.

Domestically they have built ships for Trans-Asia Shipping Lines, Gothong Southern Shipping, etc.

Notable Projects: Some landmark ships built by Tsuneishi Heavy Industries Philippines include:

  • The first 107,500 DWT bulk carrier built in the Philippines in 2015
  • Chemical tanker FPV Cebu for Formosa Plastics that meets the highest global standards
  • Japan’s largest ferry the Cebu Queen for Kyushu Sanko Group fitted with advanced technologies

With continued capacity expansion plans, Tsuneishi is sure to retain pole position in Philippine shipbuilding for years.

shipbuilding companies in the Philippines

2. Hanjin Heavy Industries and Construction Philippines

Hanjin Philippines is a subsidiary of Korean conglomerate Hanjin Heavy Industries which set up operations in Subic Bay free port in 2007. They have delivered 130 vessels amounting to 4.7 million DWT including some mega size gas carriers.

Production Capacity: Their shipyard spread over 279 hectares can produce 200,000 DWT per annum. Hanjin has three dry docks with one giant drydock at 565m x 105m size.

Key Ship Types: Hanjin builds state-of-the-art carriers for liquid petroleum gas (LPG), container ships and extra large oil tankers. They are considered among the top 5 builders globally for high end gas ships to transport LNG and LPG.

Major Clients: Hanjin’s clients include shipping majors like SK Gas (Korea), Bergen Tankers (Norway), Wan Hai Lines (Taiwan), H-Line shipping etc.

Notable Projects: Hanjin built Asia’s first giant cape size LPG carrier Silver Eagle in 2019 for SK Gas. The vessel uses LPG dual fuel propulsion resulting in low emissions.

They have also built large LPG carriers for Brookfield Shipping Lines (Nova Gas), Kleimar N.V.(Kmar Gas) and Norwegian ship owner Solvang. Each ship cost nearly $80 million underscoring Hanjin’s expertise in complex builds.

Hanjin remains a strong contender for mega-sized shipbuilding projects in the Philippines.

shipbuilding companies in the Philippines

3. Keppel Philippines Marine

Though much smaller than the top two shipbuilders, Keppel Philippines Marine (KPM) has been operating since 2002 focusing on offshore marine engineering. They do complex fabrication and assembly work to support parent company Keppel Offshore and Marine globally.

Production Capacity: KPM’s capacity is nearly 50,000 DWT annually including dry docking and afloat repairs. They are expanding the Subic yard to widen capabilities.

Key Ship Types: Their specialization lies in building support vessels for offshore oil and gas operations. This includes works boats, anchor handling tug boats, platform supply vessels etc.

Of late KPM has diversified into passenger ferries as well.

Major Clients: Main customers have been multinational drilling contractor Awilco, offshore operators like Bluewater Services, Island Offshore etc.

Notable Projects: Keppel Philippines recently delivered South East Asia’s first LNG dual fueled tug boat ‘MV Eagle Premier’ to its parent entity Keppel Smit Towage. The harbor tug uses cleaner LNG fuel resulting in emissions reduction versus conventional tugs.

With the government pushing for sustainability and energy efficiency, we can expect more such innovative green ships from Keppel’s stable.

4. Herma Shipyard Inc

Though much smaller than the top 3, Herma Shipyard is among pioneers in Philippine shipbuilding entering the industry back in 1985. They are based in Zamboanga and mainly construct vessels for domestic owners.

Production Capacity: Herma has capacity to build over 10,000 DWT annually in its yard spread across 10 hectares. In 2018, they started work on expanding their facilities including drydock and slipway upgrades for larger capacity.

Key Ship Types: Herma is mainly concentrated on building passenger ferries, RoRo vessels for cargo transport and support crafts. They are currently building 6 RoPax ships for major domestic owners 2Go Travel and Moretecon Logistics.

Major Clients: Herma’s key clients include Philippine inter-island shipping leaders like 2Go Travel, Logistics Support, Moreta Shipping etc. They also export smaller crafts to Taiwan, East Timor and PNG.

Notable Projects: Herma built the MV St Braquiel owned by Moretecon, the largest commercial boat in the country today. The vessel has capacity to transport 850 passengers and over 2,000 tons cargo.

Herma’s technical expertise in RoRo ferries and their strong relationship with domestic shipping companies makes them a formidable player.

5. Propmech Corporation

Propmech Corporation, established in 2013 has quickly gained a reputation for building specialized vessels for military transport and coast guard use. Their main facilities are in Mariveles, Bataan where they built a 300m x 50m slipway in 2015 to launch larger vessels.

Production Capacity: Propmech has capacity to build 5,000 DWT annually including complex steel fabrication and light metal works.

Key Ship Types: Propmech specializes in building high speed aluminum vessels for coast guard and defense including landing craft transports and fast patrol boats. They also build small to mid-sized passenger vessels for commercial use.

Major Clients: Philippine government remain Propmech’s largest customer with a steady stream of orders from Department of Defense and Philippine Coast Guard. Their speedboats have been exported to allied foreign navies as well.

Notable Projects: Propmech has supplied over 100 new patrol boats to the Philippine Coast Guard over the past 3 years as part of the organization’s modernization program.

They have also delivered armored vehicles, riverine crafts and landing craft utilities to support amphibious military transport operations.

With geopolitical tensions rising in Southeast Asia amidst China’s military posturing, we can expect continued demand for Propmech’s high speed crafts.

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The Philippines has clearly cemented its position among the top Asian shipbuilding countries. Within a relatively short span it has managed to build expertise across diverse vessel types and sizes.

Japanese giant Tsuneishi leads the pack with the largest capacity and market share. Meanwhile Hanjin and Keppel cater to high value gas transport and offshore segments. Domestic players Herma and Propmech complement the industry with their niche product focus.

Continued government policy support, growth in seaborne trade and increasing initiatives towards sustainability is expected to drive future opportunities for Philippine shipyards.

Frequently Asked Questions (FAQ)

What is the current size and growth outlook for the Philippine shipbuilding industry?
The Philippine shipbuilding industry currently generates nearly Php 60 billion ($1.2 billion) annually according to trade association Pami. It provides over 100,000 direct jobs while supporting 250,000 more in allied sectors.

The industry grew at a CAGR of 20% over 2010-2020 and outlook remains robust driven by strong demand, capacity expansion and supportive policies. Philippines aims to be No.1 in Southeast Asia within the current decade.

How did Philippines build shipbuilding capabilities and gain global recognition?
From humble beginnings in 1990s, Philippines has systematically built shipbuilding prowess through policy thrust on infrastructure, incentives for technology transfer and skill development. Strategic location, cost and English proficiency have helped win foreign contracts.

With players like Tsuneishi and Hanjin setting up large yards, Philippines has proven expertise in diverse ship types from cargo carriers to complex LNG vessels. Further investments in green shipping aligned with IMO targets will help cement leadership.

Does government offer any incentives for shipbuilding industry in the Philippines?Yes the government offers an attractive package of fiscal and non-fiscal incentives to shipbuilders and maritime enterprises through the Philippine Economic Zone Authority (PEZA).

These include:

  • Corporate Income Tax Holiday (ITH) – 100% exemption for first 4 years, 50% on 5th year
  • Duty free importation – on equipment, spare parts, raw materials etc.
  • Permanent resident status – for foreign nationals occupying supervisory/technical roles
  • Zero VAT – on local purchase of goods and services

Such incentives coupled with the strategic advantage of Philippines location has boosted industry growth significantly.

I hope the detailed profiles and comparisons of the top 5 shipbuilders provide a good overview of capabilities and outlook of the Philippine shipbuilding industry. Let me know if you need any clarification or have additional questions, I’ll be happy to help!

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