Japan Plans Shipbuilding Capacity Revival as LNG Carrier Competition Intensifies
Japan is preparing a major shipbuilding revival that could restore domestic LNG carrier production and intensify competition with South Korean yards, as Tokyo targets a doubling of national...
Japan is preparing a major shipbuilding revival that could restore domestic LNG carrier production and intensify competition with South Korean yards, as Tokyo targets a doubling of national shipbuilding capacity by 2035.
Quick Skim
Namura Shipbuilding is considering building a large new dock near its Imari shipyard in Saga Prefecture capable of constructing LNG carriers, ammonia carriers and other next-generation energy vessels. The project could cost as much as ¥100 billion (US$630 million), including government support.
Namura Considers New Large Shipbuilding Dock
If completed, the facility would become Japan’s first new large shipbuilding dock since Imabari Shipbuilding opened one in Marugame in 2017.
The proposed dock would give Namura capacity to participate in markets for large energy carriers that have increasingly been dominated by South Korean and Chinese shipbuilders.
Japan’s transport ministry has also brought Namura Shipbuilding, Imabari Shipbuilding and Kawasaki Heavy Industries together to discuss establishing a stable domestic supply system for LNG carriers.
The longer-term goal is to rebuild the capability for LNG carriers to be designed and constructed within Japan.
Japan Targets 18 Million Gross Tons of Capacity
Shipbuilding has been identified as one of 17 strategic industries in Japan’s national growth strategy.
The government is seeking around ¥1 trillion in public and private investment by 2035 and aims to double annual shipbuilding capacity from approximately 9 million gross tons to 18 million gross tons.
Prime Minister Sanae Takaichi has placed the revival of shipbuilding within Japan’s economic-security agenda, reflecting the sector’s importance to trade, energy transport and national industrial capability.
Tokyo is also considering subsidies that could help narrow the construction-cost gap between Japanese yards and competitors in South Korea and China.
China and Korea Lead Global Ship Orders
Japan’s renewed investment comes after decades of declining global market share.
Japan led global shipbuilding until the 1990s before South Korea moved ahead in the 2000s and China became the dominant shipbuilding nation during the following decade.
Through July 2026, China accounted for 75% of global new ship orders by compensated gross tonnage, followed by South Korea with 17% and Japan with just 2%.
Rebuilding large-vessel capacity would therefore represent a significant attempt by Japan to regain a larger role in the global shipbuilding market.
LNG Carriers Become Key Competitive Market
South Korean shipbuilders continue to hold a strong position in LNG carrier construction.
Of the 55 LNG carriers ordered globally during the first half of 2026, Korean shipyards secured 36, or 65.5%, while Chinese yards won the remaining 19 orders.
Japan’s potential return could add another competitor to a segment already seeing stronger competition between Korea and China.
The domestic market could also be important. Japan remains heavily dependent on LNG imports, meaning Japanese shipping companies and energy groups are major customers for LNG carriers.
If more of those vessels are constructed domestically, Korean shipbuilders could lose some orders from one of Asia’s largest LNG-importing markets.
Technology and Workforce Remain Challenges
Japan is not expected to re-enter the LNG carrier market at scale immediately.
Japanese yards have limited recent experience with membrane-type LNG carriers, which have become the dominant design for modern large LNG vessels. Japan has not built a membrane-type LNG carrier since 2018.
The industry also faces workforce constraints after decades of contraction reduced the number of skilled shipbuilding workers available domestically.
Japanese shipbuilders are reportedly considering technical cooperation with South Korean companies as they rebuild LNG carrier manufacturing capabilities.
Revival Could Create Opportunities for Korean Suppliers
Japan’s shipbuilding expansion may also create opportunities for South Korea’s marine-equipment industry.
Korean suppliers hold strong positions in specialised LNG technologies including cryogenic insulation systems, meaning an increase in Japanese LNG carrier construction could generate additional equipment demand even as competition between the countries’ shipyards grows.
Japan’s strategy therefore has implications across the regional shipbuilding supply chain, from large vessel construction to specialised equipment, engineering and workforce development.
With government backing and major yard investment under consideration, Japan is positioning shipbuilding as a strategic industrial capability once again as competition across Asia’s maritime manufacturing sector intensifies.
