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Shipbuilding

The maritime service sector is composed of four sub-sectors which are crew supply and management, ship management, business-process management services, including education and training and shipbuilding and repair. Shipyards established in the Philippines are building ships of larger tonnage capacities like bulk carriers, container ships and passenger ferries.

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Vibrant Shipbuilding economy

The Philippines has one of the most vibrant shipbuilding economies, boasting about 118 shipyards.

Source: The Maritime Executive

5th largest shipbuilder globally

The Philippines is the 5th largest shipbuilder globally after China, South Korea, Japan, and Germany in terms of the total gross tonnage order book for ship construction in 2018.

Source: Business World

US$1.6 billion revenue generated

The revenue generated by the shipbuilding and repair industry in the Philippines is estimated at $1.6 billion.

Source: DTI & BOI

The maritime service sector is composed of four sub-sectors which are crew supply and management, ship management, business-process management services, including education and training and shipbuilding and repair [40]. Shipbuilding is one of the largest players in this sub-sector. Shipyards established in the Philippines are building ships of larger tonnage capacities like bulk carriers, container ships and passenger ferries [41]. There are more than a hundred domestic shipyards and many of them are located in Manila and Cebu [42].

The arrival of foreign shipbuilders in the Philippines propelled the export growth of Philippine-made ships in the international market [41]. The vessels that the country exports are mostly bulk carriers and containerships, and export is driven by foreign-owned shipbuilders. Domestic shipyards are largely focused on repairing ships, an activity where the bulk of their revenue comes from [42][43]. Since 1994, export-oriented shipbuilding has played a significant role in the country’s economy. It accounted for 2.6% of the Philippine exports, or $1.5 billion, while the revenue generated by the shipbuilding and repair industry is estimated at $1.6 billion [42].

Opportunities and
advantages

The country has a unique position in the shipbuilding global value chain as it has strong demands for smaller vessels in the domestic market and is presently an exporter of large commercial ships for the international market [42].
Being the 2nd largest archipelago in the world, making it suitable to build a shipbuilding base, the Philippines’ geographic structure and location became one of the primary factors for it to be the shipbuilding and ship repair hub in Asia [41]. It is also located along key Southeast Asian trade routes, making it a convenient location for repair [42].
The country has an adequate supply of skilled manpower for shipbuilding and ship repair. Filipino workers are trainable for the skills that would fit shipbuilders’ requirements; hence, they can be sourced within the city or municipality where shipyards could be located [41].
Based on the archipelago, the shipbuilding industry is now slowly shifting to Asia. The Philippines, which specializes in production, will likely exceed market shares of the traditional shipbuilding countries [41].
Ships built in the Philippines are known for their durability and quality [41].
Importation of major raw materials has been liberalized since 1989 to allow companies to get quality inputs at favorable prices [41].
Shipbuilders located in economic zones enjoy tax and duty exemptions [41]

Featured Companies

Keppel Philippines Marine, Inc (KPMI) Keppel started operating its shipyard in the Philippines in early 1994. As the leading shipyard group in the Philippines, Keppel Philippines Marine, Inc (KPMI) offers a broad spectrum of construction, conversion, shipbuilding, repair and fabrication services to the offshore and marine industry. KPMI operates Keppel Batangas Shipyard and Keppel Subic Shipyard and delivered over 100 vessels and offshore structures. The Keppel Subic Shipyard is one of the largest drydocks in the country. KPMI Philippine yards have also constructed sections for several semi-submersible oil rigs as an offshore structure fabricator. Strategically located along the key Southeast Asian trade route, KPMI yards have established a reputation in the global market as a versatile, reliable ship repairer with a full range of drydocks [44].

Tsuneishi Heavy Industries (Cebu) Inc. (THICI) Tsuneishi Heavy Industries, one of the leading medium sized shipbuilders in the world, was established in 1994 in Buanoy, Balamban, Cebu. Operated by Japan’s Tsuneishi Holdings Corp., in partnership with Cebu’s Aboitiz Group, the company has already produced about 278 ships. Shipbuilding, ship repair and manufacturing of outfittings for ships and vessels constitute the main business of the company. Being diverse and multi-affiliated, THICI also engages in the engineering and fabrication services. With more than 12,000 employees including affiliates and subcontractors, the company ships medium-sized vessels to different parts of the world [45].

Herma Shipyard Inc. (HSI) Herma Shipyard Inc. is one of the largest Filipino-owned shipyards established in June 2000 and located in Mariveles, Bataan [46]. HSI provides comprehensive ship dry-docking, repair, and maintenance whether in the graving dock, floating dock, or slipway. This includes light and heavy mechanics, restoration and fabrication of parts, computer-automated cutting, welding and steelworks, piping system renovation and assembly, blasting and painting. HSI has worked on a wide range of vessels like passenger ferries, container carriers, military and patrol crafts, barges, tug boats, pleasure yachts, marine research vessels, and fishing boats, as reviewed by a client of Herma Shipyard.

Gensan Shipyard and Machine Works, Inc. GSMWI is a Filipino-owned shipyard founded in southern Mindanao in 1999 to handle the dry-docking, repair and construction needs of all fishing and service delivery boats. Capable of full-scale ship repair, building, fabrication and ship recycling, the company expanded their services to accommodate clients from Papua New Guinea, South Korea, China, and Taiwan. Established as one of the leaders in ship design and construction in the Philippines, Gensan Shipyard is also equally regarded in terms of our specialized repair and maintenance [47].