Photo of MSC ship under construction / Source: Zhoushan Changhong International Shipyard
Container ship newbuilding deliveries are seeing their longest lead time since the global financial crisis in 2008/2009, according to Alphaliner. The global container ship orderbook has grown to a record size of 9.1 million TEUs this month, with close to 800 newbuildings under construction, working out to around 29% of the in-service fleet.
While the orderbook is the largest that it has ever been in terms of capacity, it also stretches out far further than ever before, with some of the aforementioned ships only due in 2030 – five years from now.
The market has not seen such long vessel construction times, since the ordering boom of 2005-2007, that preceded the market crash of 2008.
After the crash of 2008, owners renegotiated and deferred deliveries, which led to some ships being handed over with delays of one or even two years. Usually, ships take two years to construct, in a normal market.
The situation in the early 2010s is recurring among more recent newbuilding orders, according to Alphaliner, which said: “Finding delivery slots three years out is already very challenging, and that lead times of four years are becoming the norm. For longer series of ships, the later units will even be delivered five years after contract signing”.
A boom in newbuilding orders has seen shipyards up to their necks, with some, like New Times and Yangzijiang, having to expand their capacity to expedite vessel construction.
Further to this, the world’s largest shipbuilding group, China Shipbuilding Group (also known as China State Shipbuilding Corporation), has begun to accept container ship orders at affiliate yards that were typically focusing on other vessel types. This includes builders such as Shanhaiguan Shipyard and Guangzhou Shipyard International, which were known more for constructing bulk carriers, tankers and car carriers.
Quarterly averages clearly illustrate the increasing delivery times for ships. A vessel ordered in Q2 2021 during the post-Covid-19 boom will be delivered, on average, 2.98 years later. In contrast, a ship ordered in Q2 of 2024 is only due 3.56 years later, on average.
