Staying afloat: After declines in defense spending, military shipbuilding will bolster revenue moving forward

Over five years to 2018, the Ship Building industry, made up of operators that design, build and repair ships and other vessels for both the defense and commercial sectors, encountered rough seas as demand sank. The industry maintained some stability as long project lead times for ships and consistent demand for military ships from the US Navy kept shipyards busy. However government spending cuts, including to the defense budget, pressured spending on naval vessels and inhibited industry revenue growth over the past five years. Over five years to 2023, industry revenue is forecast to grow, however, as the US Department of Defense's increased emphasis on maritime operations is anticipated to create steady demand for new naval vessels...purchase to read more.

Industry Statistics & Market Size
Revenue
$26bn
Annual Growth 13-18
-1.4%
Forecast Growth 18-23
Profit
Employment
106,074
Businesses
705
Market Share of Companies

Industry Threats & Opportunities

  • Government spending cuts, including to the defense budget, pressured spending on naval vessels and inhibited industry revenue growth
  • Commercial shipyards have been able to eschew cyclical downturns because of long lead times
  • Demand from the US Navy will remain the backbone of industry growth
  • Industry Report - Industry Analysis Chapter

    Over the past five years, the Ship Building industry has slowly navigated choppy waters as demand from the Department of Defense (DOD) and commercial markets deflated. Industry operators design and build ships and other vessels for defense agencies and commercial shipping companies, as well as providing support services, such as ship repair, maintenance, conversion, refurbishment, lifecycle extensions and modernization. Industry revenue peaked in 2013 as consistent demand from the US Navy and long project lead times kept shipyards busy. Additionally, a boom in US oil and natural gas production contributed to the surge in demand for energy-related vessels, especially oil tankers. How...purchase to read more.

    Additional Insights for the Ship Building Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Ship Building Industry are

  • Financial structure of the company
  • Undertaking technical research and development
  • Proximity to key markets
  • IBISWorld analysts also discuss how external factors such as Federal funding for defense and Private investment in industrial equipment and machinery in the Ship Building industry impact industry performance..

    shopping_cartPURCHASE OPTIONS

    What's in this report

    What is the Ship Building Industry?

    Shipbuilders operate shipyards, which are fixed facilities with dry docks and fabrication equipment capable of building a ship. A ship is defined as watercraft typically suitable or intended for use other than for personal or recreational purposes. Shipyard activities include ship construction, repair, conversion and alteration; the production of prefabricated ship and barge sections; and specialized services, such as ship scaling.

    Industry Products
  • Military shipbuilding
  • Nonmilitary shipbuilding and repair
  • Military ship repair
  • Industry Activities
  • Building barges
  • Building cargo ships
  • Building passenger ships
  • Building submarines
  • Building drilling and production platforms
  • Repairing ships
  • Converting or altering ships
  • Producing prefabrication ship and barge sections
  • Building military ships
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Federal funding for defense
  • Private investment in industrial equipment and machinery
  • US oil and gas production index
  • Consumer spending
  • Price of steel

  • Current Performance
  • Military dominance
  • Commercial market and trade
  • Competitiveness and profitability
  • Chart: Revenue Growth

  • Industry Outlook
  • Government demand remains crucial
  • Commercial market tides rise slowly
  • Other trends
  • Table: Ship Building Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Ship Building Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Oil Drilling & Gas Extraction
  • Iron Ore Mining
  • Ocean & Coastal Transportation
  • Port & Harbor Operations
  • Stevedoring & Marine Cargo Handling
  • National Security and International Affairs
  • Sightseeing Transportation

  • Key Selling Industries
  • Aluminum Manufacturing
  • Engine & Turbine Manufacturing
  • Hardware Manufacturing
  • Metal Pipe & Tube Manufacturing
  • Navigational Instrument Manufacturing
  • Paint Manufacturing
  • Screw, Nut & Bolt Manufacturing
  • Steel Rolling & Drawing

  • Products & Services
  • Military shipbuilding
  • Nonmilitary shipbuilding and repair
  • Military ship repair
  • Chart: Ship Building Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • US government
  • US commercial shipping clients
  • Exports
  • Chart: Major Market Segmentation for the Ship Building Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases
  • Wages
  • Rent, utilities, depreciation and marketing
  • Other costs
  • Chart: Cost Structure Benchmarking – Sector vs Ship Building

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Ship Building Industry

  • Industry Globalization
    General Dynamics Corp., Huntington Ingalls Industries Inc.,
  • Table: General Dynamics Corp. - financial performance
  • Table: Huntington Ingalls Industries Inc. - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Ship Building Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Ship Building Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Exports (2009-2023)
  • Imports (2009-2023)
  • Wages (2009-2023)
  • Federal Funding for Defense (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Barge
  • A flat-bottomed boat that is built mainly for river and canal transport of heavy goods.
  • Dry Dock
  • A narrow basin that a vessel floats in, and is then drained to enable the vessel to come to rest on a dry supported platform.
  • Shipyard
  • A fixed facility with dry docks and fabrication equipment capable of building a ship.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s industry research report on Ship Building can be used to help you understand the industry’s market size, growth potential and major companies. Five-year forecasts provide insight into the industry’s prospects, so you can make decisions with confidence. This information is perfectly suited to informing your business plans, pitch books, benchmarking and SWOT analysis.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Ship Building:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Ship Building market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Ship Building, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

    Contact Us

    Want to speak to a representative? Call us.

    clear