DNV has been part of the Korean shipbuilding industry for decades. Systematic initiatives to ensure knowledge sharing between DNV and giants such as Daewoo, Hyundai and Samsung have been a vital part of DNV's operations in Korea
As of 1 July 2004, 219 ships totalling almost 13Mgrt have been ordered from eight major Korean yards. This year alone, DNV won contracts for about 80 new vessels with a market share of about 35 percent. The capacity of the yards is full, and there will be some extremely challenging years ahead with an order backlog of around 840 ships totalling around 50Mgrt. Still, all parties involved seem confident that Korean yards will continue to deliver on the reputation it has built up over the years.
A place on the winning team
DNV's maritime regional manager for South Korea, Svein Svarstad, says DNV is now firmly ensconced in the area. For instance, through several Joint Industry Projects, programmes for exchange of engineers, workshops, committees and even a dedicated DNV Academy in Korea, DNV has become a valuable partner in the Korean shipbuilding industry. The mutual respect between highly skilled professionals is ingrained in the Korean culture and DNV has received similar approbation, which helps ensure efficient and smooth cooperation between DNV and the yards; a particularly important factor during the current boom in Korean shipbuilding.
Equipped to deal with obstacles
Placing so many orders in Korean yards is clearly a vote of confidence from international shipowners to the Korean shipbuilding industry. The workload is heavy, and the yards are fully aware of the fact that they are stretching themselves with so many ships on order. Adding to this, Korea just introduced the five-day working week instead of its traditional six-day week.
Moreover, machinery is now coming into the yards not only from the traditional tried and tested suppliers, but also from a new and growing network of manufacturers from Croatia to China. The yards have little experience with many of these suppliers, and in order to keep a consistent quality, DNV's Certification of Materials & Components' services and other quality control measures become increasingly important.
The wide international network and integrated production system (Nauticus) of DNV is also used to keep a consistent high standard.
Market outlook
So what is next? The order books for the coming three years are full, so it is mainly a question of schedules for different ship types. "For the short term, I expect that the rest of this year will see a general slowdown, except for LNG vessels," comments DNV's marketing manager ST Kang. "The yards are prepared for the peak of LNG orders which are coming in the second part of this year. But in the longer term, the yards foresee a boom for tankers, to keep pace with the phasing out of the single hull tankers. They also expect the container-ship market to be steadily growing."
DNV's overall strategy has been to work very closely with all the parties involved. This includes initiatives to build the owners' competence through training on issues of particular relevance to the owners, pre-contract services, and fully authorised approval centres independent of the head office in order to ensure expedience. Another initiative to deliver customer-oriented solutions has been to establish a very independent role for the project manager on each newbuilding. The project manager is in the driving seat, ensuring a single point of contact with overall responsibility for the progress and quality of the project.
"But most importantly," concludes Svarstad, "sharing knowledge and working together is the key to be able to come up with new and innovative solutions. Plus, of course, hard work throughout the years, as anyone in the industry can testify. And it just gets busier."