14 November 2024 AXSMarine
The demand for new vessels in the global merchant fleet, particularly Tankers, Container Ships, and LNG carriers, continues to grow in 2024. With it, a new challenge is emerging - the delivery time for new orders has steadily increased, impacting stakeholders across the board.
Importance of rising delivery times
Shipyard delivery times - the period between an order placement and the ship delivery to its owner - offer a critical view into yard capacity and market demand. Since 2020, the average delivery time has been gradually extending for Container Ships, Dry Bulkers, and Tankers. After 2022, the trend has been going upwards for all four major segments, including LNG carriers. As a result, average delivery times are now approaching three years for Tanker vessels and 3.2 years for Container Ships. For LNG carriers, it is even longer, especially from China, where average delivery times are approaching 4.8 years.
When shipyard capacity is constrained, the lead time for commissioning new vessels lengthens. Shipowners may then be forced to keep older ships in operation longer, or they might look to the second-hand market to meet their fleet needs. Tight yard space can also affect newbuild pricing, pushing up costs and limiting flexibility.
The availability of shipbuilding slots has been bottlenecked, particularly in the most prolific shipbuilding nations. China now averages around 3 years in delivery time, with Tankers at 2.8 years, and LNG vessels even higher. Capesize Dry Bulkers ordered in 2024 are currently expected to be delivered in 3.6 years on average.
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