Korea Shipbuilding Industry Posts Sharp Drop in Patent Applications
Patent applications by Korean shipbuilders have fallen to one fourth the level of five years ago, the Korean Intellectual Property Office (KIPO) says in a recent report. The drop is the result of a deep cut in research and development investment and related human resources by companies amid a prolonged slump.
The number of patent applications in Korea’s shipbuilding sector fell from 3,692 in 2014 to 1,955 in 2018 and further to 894 in 2019, the KIPO report showed on Aug. 23. The number of patent applications filed by the three major shipbuilders (Korea Shipbuilding & Marine Engineering Co., Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co.) peaked at 2,127 in 2014 before plummeting to 822 in 2019.
The sharp drop in patent applications stemmed from a crisis in the shipbuilding industry. Korean shipbuilders were overtaken by their Chinese rivals in 2010 and faced a crisis in 2014 due to falling international oil prices. They cut R&D investments in the face of a big crisis. The amount of R&D expenses in the Korean shipbuilding industry sank more than 60 percent from 385.5 billion won in 2014 to 141.8 billion won in 2018. The number of researchers also declined from 2,572 to 822 during the same period as shipbuilders downsized their R&D workforce.
Korean shipbuilders regained the top spot in order intake, which they lost to their Chinese competitors in 2018. They are still ahead of their competitors in terms of overall patent applications and registrations. However, some experts point out that Korean shipbuilders will face challenges in the long term. Chinese shipbuilders have turned the tide in patent applications in the fields of environmental regulations and smartization, the two major pillars of change in the shipbuilding industry in the future.
The world shipbuilding industry is moving from bigger ships in the 1960s to vessels with reduced environmental pollution, high safety and smart automation. According to the International Maritime Organization (IMO), the number of Korea’s patent applications related to environmental regulations in the shipbuilding industry stood at 892 in 2016, losing the number one position to China (904). China chalked up the highest number of applications for four consecutive years until 2019. China (418 patents) overtook Korea in smart technology as well in 2018. As a result, the gap between Korea and China narrowed to 1,041 and 2,471 in patent applications in environmental regulations and smartization, respectively.
Source: Business Korea