All 17 new orders for pure car and truck carriers (PCTC) worldwide in January were won by Chinese shipbuilders, a feat that may seem unremarkable at first glance. However, considering that only four PCTCs were traded on average annually between 2016 and 2020, this achievement is indeed impressive. China’s thriving car exports and shipowners’ need for replacement vessels have spurred demand for PCTCs in recent years. In 2021, China’s automobile exports surpassed 2 million units for the first time, and that number continued to grow, reaching over 3 million units in 2022, representing a year-on-year increase of 54.4 percent. New energy vehicle (NEV) exports also rose by 1.2 times to 679,000, according to data from the China Association of Automobile Manufacturers.
Clarkson Research, a UK-based company, reports that the 17 new orders for PCTC in January totaled a combined 510,000 deadweight tonnes with 152,000 parking spots. Domestic car manufacturers, such as BYD Auto and SAIC Motor, have also begun making their own transportation plans as NEVs are typically heavier due to their batteries on top of larger passenger car models, requiring larger decks for transportation. Most of the ships in the market between 2016 and 2020 were over 20 years old and could not comply with new shipping regulations, which has led to a surge in shipowners’ demand for replacements.
Recognizing the market opportunity, China State Shipbuilding Corporation Limited (CSSC), China’s largest shipbuilder, strategically launched large-scale PCTC models in 2021, winning 32 orders for vessels with car-carrying capacities of 7,000 to 9,200, which accounts for 25 percent of the global market share. In 2022, 80 new PCTC orders were inked globally, with 47 of those designed by Shanghai Merchant Ship Design and Research Institute, the CSSC’s design arm.
Institute also unveiled the world’s largest 9,400-unit dual-fuel PCTC, which was developed with independent intellectual property rights, and China’s first 7,000-unit ammonia fuel-powered PCTC. Despite a challenging global market, China continued to hold the largest share of the global shipbuilding market for the 13th year in a row in 2022, with six companies ranking among the world’s top 10 shipbuilding enterprises. In addition to PCTCs, the CSSC received 49 LNG carrier orders in 2022, with the combined contract value surpassing $10 billion. These tank ships, designed to transport liquefied natural gas, accounted for 30 percent of global LNG orders, up from less than 7 percent in 2021, reaching a record high.
China has also made significant progress in the production of large cruise ships, one of the most complicated vessels to design and build. Construction of China’s second domestically built large cruise ship began in August 2022, with work on the first vessel proceeding on schedule. Official data reveals that China’s shipbuilders were on top in three major global indicators last year, accounting for 47.3 percent of global output, receiving 55.2 percent of new orders, and obtaining 49 percent of holding orders.
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