Marine Vessel Market Size, Share and COVID-19 Impact Analysis, By Type (Commercial Vessel, Passenger Ship, LNG/LPG Carrier, and Special Purpose Vessel), By System (Marine Engine, Sensor System, Control System, Electrical System, Auxiliary System and Communication System), By End-User (OEM and Aftermarket), and Regional Forecast, 2021- 2028

The global marine vessel market size was USD 168.56 billion in 2020. The global impact of COVID-19 has been unprecedented and staggering, with marine vessels witnessing a negative demand shock across all regions amid the pandemic. Based on our analysis, the global market had shown a decline of 17.2% in 2020 as compared to the average year-on-year growth during 2017-2019. The market is projected to grow from USD 170.75 billion in 2021 to USD 188.57 billion in 2028 at a CAGR of 1.43% in the 2021-2028 period.

The market is dependent on the volume of the global maritime trade and the shipping demand. The performance of international markets influences both. The demand for ships increases during economic growth and decreases during the recession. As stated by the United Nations Conference on Trade and Development (UNCTAD), around 80% of the global trade by volume is carried out by the sea. Therefore, it is clear that maritime transport is an engine of the global trade and economy that closely follows the GDP growth of the nation. The market is anticipated to propagate at a slow but steady pace during the forecast period.

Reduced Maritime Trade & Transport amid COVID-19 Pandemic to Affect Demand for Marine Vessels

The demand for such vessels is directly related to the international trade and economic cycles. The pandemic has reduced maritime trades and transport, which, in turn, has lowered the demand for the procurement of new vessels. Owing to the decreasing demand for container transport, the orders for containerships were on hold during the first two quarters of 2020. Moreover, the lack of passengers and declining revenues of cruise operators during the pandemic led to the decommissioning of older cruise ships.

• In June 2020, Carnival Corporation announced that 13 cruise ships would be sold and removed from their service.

Thus, COVID-19 has had a negative impact on marine vessel market growth due to decreased maritime trade and transport.

• According to the United Nations, Economic and Social Commission for Asia and the Pacific (UNESCAP), the global container shipping volume fell by 5.1% in the first quarter of 2020 compared to the same period in 2019.


• As stated by the VesselsValue agency, new shipbuilding orders declined by 41% in 2020. Total 532 new vessel orders were placed in 2020, as compared to 906 orders in 2019.

A slow recovery in new shipbuilding contracts has been witnessed in 2021.

LATEST TRENDS

Shift from Conventional Propulsion to Hybrid Propulsion System is a Prominent Trend

Huge marine vessels consume a large amount of fuel and thus contribute to global warming. However, fuel is the main cost factor for many shipping companies. Hence, improving energy efficiency is the main driver for innovation in the shipping industry. The switch from the fuel-based conventional propulsion system to the environment-friendly hybrid propulsion is increasing owing to the efficiency and cost-effectiveness of the hybrid propulsion system. Many ship operators use renewable energy, such as solar energy, as a storage option in marine hybrid propulsion systems. In this system, the stored solar energy is utilized during peak hours or at night, reducing the 24X7 need for conventional marine fuel. Moreover, strict regulations associated with reducing harmful carbon emissions have increased the demand for hybrid propulsion systems.

DRIVING FACTORS

Surge in Global Sea Trade is Expected to Increase Demand for Product

Maritime transport is the pillar of international trade and the global economy. A rise in seaborne trade across the globe is expected to fuel the growth of the market during the global marine vessel industry forecast period. According to Maritime Publications, around 80% of the global trade by volume and over 70% of the global trade by value are carried out by sea and are controlled by ports worldwide. Globalization and the rapid expansion of Asian economies, such as China and South Korea, would play a major role in maritime trade growth.

RESTRAINING FACTORS

Stringent Environmental Regulations to Hinder the Market Growth

Although ocean transportation is seen as the least polluting mode of transport, governments and international organizations have introduced several regulations associated with environmental protection to moderate the negative effects of vessels on the environment. Implementing such regulations in the old fleet is challenging and may hamper the growth of the market. The ongoing global transition to a clean and green maritime sector is expected to affect the shipbuilding industry. An increase in the international maritime environmental regulations for greenhouse gas emission, Sulphur emission, ship recycling, and others is anticipated to restrain the market growth.

Following are some of the recent regulations:

• The IMO aims to reduce CO2 emissions from shipping by 40% by 2030.


• The International Maritime Organization (IMO) 2020 regulation expects to reduce the Sulphur cap in fuel oils to 0.50% from 3.50%.


• In 2019, the IMO energy efficiency design index (EEDI) set difficult standards for new ships.

Moreover, several governments are spending on research and development to minimize pollution.

• For instance, the Government of China has made investments in the high and advanced technology industry, clean production, manufacturing of equipment or new materials, use of renewable energies, recycling, and environmental protection.

SEGMENTATION

By Type Analysis

Commercial Segment Expected to Lead the Market Due to Growing International Trade  

Based on type, the market for marine vessels is classified into the commercial vessel, passenger ship, LNG/LPG carriers, and special purpose vessel.

The commercial segment was estimated to be the largest segment in 2020, owing to a rise in maritime trade. The commercial segment is further sub-segmented into bulk carriers, container ships, tankers, auto carriers, and roll-in/roll-out (RO-RO) carriers. The demand for bulk carriers, tankers, and container ships is expected to rise during the forecast period owing to the growing shipping demand. 

Due to the increasing public transport, the passenger ship segment is predicted to be the fastest-growing segment during the forecast period. The passenger ship segment is sub-segmented into cruise ships and ferryboats. Growing demand for cruise vacationing is expected to drive the demand for cruise ships.

A ferry is a vessel type used to carry passengers and, at times, vehicles and cargo across a water body. Owing to the increasing tourism, the demand for ferryboats is rising. The segment is expected to drive the growth of the market. Europe is the leading region in terms of the passenger ship segment.

The LNG/LPG carrier segment is expected to grow at a steady pace throughout the forecast period, owing to the rising demand for fuel and oil.

The special-purpose vessel segment of this market includes research vessels and others. Research vessels carry out various research, such as oceanographic research, fisheries research, naval research, polar research, etc. The demand for research vessels is anticipated to rise during the forecast period. The growth can be attributed to the increasing investment by emerging economies, such as China, India, and countries in Latin America to expand their oceanographic research fleets.

By End-User Analysis

Rising Demand for MRO of Old Fleet will Boost the Aftermarket Segment

Based on the end-user, the market for marine vessels is divided into Original Equipment Manufacturer (OEM) and aftermarket.

In 2020, OEM was estimated to be the largest segment in the market due to growth in shipbuilding activities. The aftermarket segment is expected to be the fastest-growing segment during the forecast period owing to a rise in the demand for MRO of the old fleet.

By System Analysis

Marine Engine Segment to Dominate Market Due to Increasing Development of Eco-Friendly Engines

By system, the market for marine vessels is segmented by marine engine, sensor system, control system, electrical system, auxiliary system, and communication system.

The marine engine segment is expected to dominate during the forecast period due to the growing demand for natural gas-based engines to reduce sulfur emissions. Moreover, increasing investment by key players to develop low emission, fuel-efficient, and eco-friendly engines is expected to support segment growth.

REGIONAL INSIGHTS

Based on region, the global market is segmented into North America, Europe, Asia-Pacific, and Rest of the World.

North America marine vessel market size stood at USD 8.80 billion in 2020. The dominance of North America is due to the increase in shipbuilding in the U.S. OEMs based in the U.S.  provides components and systems to the shipbuilding companies around the world. This factor is estimated to drive the market in the region.

Asia-Pacific held the largest market share in 2020 and is anticipated to continue its dominance throughout the forecast period. The growth of the market in this region is attributed to key shipbuilding companies such as Hyundai Heavy Industries Co. Ltd., Daewoo Shipbuilding & Marine Engineering Co., and Imabari Shipbuilding Co. Ltd. in countries such as South Korea and Japan. China, Japan, and the Republic of Korea have sustained their leadership in the shipbuilding industry, representing 92.5% of new vessel deliveries in 2019.

Europe is estimated to be the second-largest market for marine vessels. The Fincantieri S.P.A. is the largest shipbuilder in the western region. The European shipbuilding industry is a leader in innovation and sustains its position as a technology provider and cleaner and safer ship provider. With its diverse fleet of commercial vessels, the European Union (EU) shipping industry contributes USD 165 billion to the EU’s annual GDP growth.

In the Rest of the World Region, sub regions such as Latin America, and the Middle East & Africa hold a lower share in the market owing to comparatively low demand for marine vessels in the region. 

KEY INDUSTRY PLAYERS

Major Players are Investing in Development of Ship Designs to Reduce Sulphur Emissions  

The competitive landscape of this market depicts the domination of selected market players, such as Daewoo Shipbuilding & Marine Engineering Co., Ltd, Hyundai Heavy Industries Co., Ltd., Imabari Shipbuilding Co. Ltd., and Fincantieri S.P.A., among others. Various organizations have invested in the research and development of such vessels to reduce the harmful effect of Sulphur emissions from ships. Moreover, fleet expansions and the replacement of older vessels are some of the other strategies used by key players to sustain their positions in the global market.

LIST OF KEY COMPANIES PROFILED:

• Hyundai Heavy Industries Co., Ltd.  (South Korea)


• Mitsubishi Heavy Industries, Ltd. (Japan)


• Kawasaki Shipbuilding Corporation (Japan)


• Samsung Heavy Industries Co. Ltd. (South Korea)


• Imabari Shipbuilding Co. Ltd. (Japan)


• Hyundai Samho Heavy Industries Co. Ltd. (South Korea)


• Hyundai Mipo Dockyard Co. Ltd. (South Korea)


• Fincantieri S.P.A.  (Italy)


• Daewoo Shipbuilding & Marine Engineering Co., Ltd (South Korea)

KEY INDUSTRY DEVELOPMENTS:

• May 2021 – Dae Sun Shipbuilding & Engineering was awarded a contract worth USD 153.6 million by SITC International Holdings Company to deliver 8 1,023teu container vessels, plus an option for two additional vessels. The eight vessels are expected to be delivered by the end of 2023.


• May 2021 – Hyundai Mipo Dockyard, Korea Shipbuilding & Marine Engineering (KSOE), ABS Ltd., and the Republic of the Marshall Islands (RMI) Maritime Administrator signed a collaboration agreement for the development of liquefied CO2 carrier ship designs to achieve carbon emission reduction targets.


• February 2020 –Daewoo Shipbuilding and Marine Engineering Co. received a contract to build two liquefied natural gas (LNG) fueled shuttle tankers for Knutsen NYK Offshore Tankers (KNOT). The order is set to be delivered in mid-2022.

REPORT COVERAGE

The market report provides a detailed analysis of the industry and focuses on key aspects, such as key players, type, system, and end-user of marine vessels. Moreover, it offers insights into market trends, competitive landscape, market competition, product pricing, market status, and key industry developments. In addition to the factors mentioned above, the market report encompasses several direct and indirect factors contributing to the market sizing over recent years.

 Report Scope & Segmentation