Revitalization of Shipbuilding Industry: Counter Chinese, S. Korean Competitors through Technological Innovation

Editorial

17:01 JST, February 16, 2026

Can Japan’s shipbuilding industry launch a counteroffensive and regain its position, having been overshadowed by Chinese and South Korean competitors? Japan must chart a path to revival as a major shipbuilding nation with technological innovation.

Prime Minister Sanae Takaichi intends to advance strategic investments that enhance resilience against potential crises under “responsible and proactive public finances” and views shipbuilding as a key sector.

To revitalize Japan’s shipbuilding industry, the government late last year formulated a roadmap through 2035. It set a target to boost annual shipbuilding output to 18 million gross tons by doubling the 2024 level.

The government will establish a fund of about ¥350 billion and proceed with public-private investments totaling ¥1 trillion. It also called for reorganizing shipbuilding companies into up to three groups.

Surrounded by sea, Japan relies on shipping for 99.6% of its trade, making it an infrastructure that supports people’s lives in many ways by providing energy and food.

From an economic security perspective, it is extremely important to strengthen Japan’s capacity to build vessels that are essential for maritime transportation and to ensure they remain operational in the event of a contingency.

However, the decline in the competitiveness of Japan’s shipbuilding industry is severe. Its construction capacity cannot even meet demand from domestic shipowners.

Japan was a major shipbuilding nation until the early 1990s, accounting for about 50% of global shipbuilding volume. However, its market share fell below 20% in 2011, after having been pushed back by China and South Korea, which bolstered their competitiveness through low labor costs and government support.

Japan’s share has continued to decline in recent years, sinking to just slightly over 10%, while China’s has surpassed 50%.

Given the current situation, achieving the target will be difficult. First, improving productivity is essential. The roadmap outlines plans to advance automation and labor reduction at production sites during the 2026-28 phase by leveraging cutting-edge technologies such as robots and artificial intelligence.

Technological innovation will likely be key to success for Japan, where labor costs are high.

Equipment upgrades are also essential. The 2029–31 phase will be dedicated to constructing and expanding facilities such as docks and cranes, with operations set to begin in the 2032–34 phase to scale up production. It is hoped that the new fund will be utilized effectively.

As part of the restructuring strategy, Japan’s largest shipbuilder Imabari Shipbuilding Co. has made the second largest Japan Marine United Corp. a subsidiary. This creates the world’s fourth largest shipbuilding capacity. It is crucial to leverage technologies such as next-generation-fuel vessels with high environmental performance.

Shipbuilding is one of the areas of cooperation incorporated into Japan’s investment plans for the United States, which were agreed during the bilateral tariff negotiations. U.S. President Donald Trump’s administration aims to revitalize the declining U.S. shipbuilding industry.

Shipbuilding capability lies at the core of maritime defense capabilities, such as battleships. To strengthen the Japan-U.S. alliance, the two countries must cooperate to develop strategies that will bolster the shipbuilding industry.

(From The Yomiuri Shimbun, Feb. 16, 2026)