Samsung Heavy Industries (010140.KS) has chosen Vietnam as the next key base for its "Global Operations" strategy, which expands production capacity through partnerships with overseas firms. The plan calls for outsourcing the construction of standard vessels to Vietnamese partners with well-developed shipbuilding infrastructure to maximize building efficiency, while concentrating domestically on developing high-value vessel types, including offshore facilities.
Samsung Heavy Industries is moving to establish a local subsidiary in Vietnam, according to industry sources Tuesday. After the management committee within Samsung Heavy Industries' board of directors approved the matter early this year, the company has been carrying out related procedures. Samsung Heavy Industries reportedly launched the subsidiary establishment to begin expanding its Vietnam business in earnest and to strengthen partnerships with local firms.
Samsung Heavy Industries is paying particular attention to Vietnam as an overseas base for building standard vessels such as container ships and oil tankers. The company has adopted an approach in which it handles design and equipment purchasing and procurement for standard merchant vessels, while outsourcing block and hull manufacturing to partners in China and Southeast Asia to boost production efficiency. Through this, the strategy is to specialize the Geoje shipyard in high-value vessel types such as eco-friendly ships and floating liquefied natural gas production facilities (FLNG).
Samsung Heavy Industries has already signed a contract to build three oil tankers, ordered last year by a Liberian shipowner, at the shipyard of PetroVietnam Shipbuilding Industry (PVSM), a subsidiary of Vietnamese state-owned oil company PetroVietnam. If the construction work is completed successfully, ship-building collaboration between the two companies is expected to expand further. In April this year, the company raised the level of cooperation by signing an agreement with PetroVietnam to build a cooperation framework in the shipbuilding and energy sectors.
In particular, cooperation with Vietnam is analyzed as helping Samsung Heavy Industries reduce its reliance on China for overseas production. Samsung Heavy Industries has utilized Chinese shipbuilders as key partners in its Global Operations strategy. However, as the second Donald Trump administration, which took office last year, raised the level of shipbuilding sanctions targeting China, the need to replace overseas outsourcing partners grew. The United States is gradually raising port fees imposed on Chinese-made vessels and strengthening regulations, including excluding Chinese-made vessels from future eco-friendly ship adoption.
Samsung Heavy Industries is using overseas outsourced production through Vietnam and other countries to address domestic dock saturation, while also accelerating orders centered on high-margin vessel types. This year, Samsung Heavy Industries has won a total of 30 vessel orders, including 13 liquefied natural gas (LNG) carriers, two FLNG units, and one floating storage and regasification unit (LNG-FSRU). This amounts to $9.6 billion (about 14.75 trillion won), reaching 70% of Samsung Heavy Industries' annual order target of $13.9 billion.
