all report title image

The global Ship Conversion market size was valued at US$ 13.46 billion in 2023 and is expected to reach US$ 22.63 billion by 2030, grow at a compound annual growth rate (CAGR) of 7.7% from 2023 to 2030. Ship conversion involves modifying or retrofitting vessels for purposes other than their original intended use. This includes converting commercial ships for military applications, cargo carriers to passenger ships, tankers to offshore vessels etc. The rising seaborne trade and the need to comply with environmental regulations are key drivers fueling the growth of the ship conversion market.

By vessel type, the container vessels segment accounted for the largest share of the market in 2022. The rise in containerized shipping to transport manufactured goods globally has led to increased demand for conversion of container ships to meet changing industry needs. For instance, outdated container ships are being converted to carry grains and other dry bulk commodities.

Ship Conversion Market Regional Insights

  • Asia Pacific is expected to be the largest market for Ship Conversion Market during the forecast period, accounting for over 35% of the market share in 2022. The growth of the market in Asia Pacific is attributed to the presence of major shipbuilding nations like China, Japan and South Korea.
  • The Europe market is expected to be the second-largest market for Ship Conversion Market, accounting for over 25% of the market share in 2022. The growth of the market in Europe is attributed to the presence of leading ship conversion yards in countries like Turkey, Poland, Netherlands etc.
  • The North America market is expected to be the fastest-growing market for Ship Conversion Market, with a CAGR of over 12% during the forecast period. The growth of the market in Middle East & Africa is attributed to the increasing offshore oil & gas activities and growth in maritime tourism industry.

Figure 1. Global Ship Conversion Market Share (%), by Region, 2023

 | Coherent Market Insights

Ship Conversion Market Drivers:

  • Increasing seaborne trade and cargo transportation: The growth in seaborne trade and rising cargo transportation through ships is a major factor driving the ship conversion market. As per industry estimates, around 80% of global merchandise trade by volume is carried out by seaborne transportation. The rising trade activities have led to increased demand for cargo ships and conversions to expand capacity or retrofit vessels to meet cargo requirements. Converting existing ships provides a cost-effective way to add capacity and meet trade growth compared to new builds.
  • Rising energy exploration activities: The increase in offshore oil and gas exploration and production activities is fueling the demand for ship conversions, especially oil tankers and offshore support vessels. Declining oil production from maturing onshore fields has led to higher E&P activities in offshore deepwater and ultra-deepwater fields. This is creating substantial demand for retrofitting and converting oil tankers into FPSOs, drill ships, offshore support vessels to support offshore projects.
  • Growth in passenger cruise tourism: The expanding cruise tourism industry is leading cruise liners to upgrade existing ships and convert vessels to meet changing consumer expectations. Adding new amenities, passenger capacity and technologies through ship conversions provide an avenue for cruise companies to attract more tourists and gain a competitive edge. The growth in expedition and adventure cruises also requires ice-capable and technologically-advanced retrofitted cruise ships.
  • Demand for green ships: With sustainability becoming vital in the maritime industry, ship owners are converting conventional ships into eco-friendly vessels running on alternative fuels like LNG, to comply with emissions regulations. Older ships are also undergoing conversions to improve their energy efficiency and environmental performance. The demand for green retrofitting to reduce pollution is rising across shipping verticals.

Ship Conversion Market Opportunities:

  • Navy fleet modernization programs: Several countries have announced fleet modernization and expansion programs to strengthen naval capabilities in response to rising security challenges. This is creating substantial opportunities for naval ship conversions and refits to upgrade weapons, sensors, propulsion, and platform systems. Converting older naval ships provides a faster and cost-effective option over new constructions.
  • Development of autonomous ships: Advances in maritime technologies and automation are leading to the gradual adoption of autonomous ships. The conversion and retrofitting of existing crewed ships into autonomous vessels provides an opportunity to leverage these futuristic operations. Companies can potentially target conversions to upgrade navigation, communication and control systems for autonomous operations.
  • Expansion into emerging economies: Rising investments to develop shipbuilding infrastructure and capabilities in emerging economies such as India, Southeast Asia, Middle East, and Africa is opening up new geographical opportunities. Companies can expand into these markets by leveraging lower cost advantages and tap into conversion demand from local ship owners and yards. Local partnerships can help gain share.
  • Inland waterway vessel conversions: Growth in inland waterway transportation for domestic cargo movements provides new conversion opportunities for obsolete marine vessels. Companies can target conversions of deep-sea ships into river-sea ships, barges and other vessels types suited for inland waterways. Conversions can also meet the demand for eco-friendly cargo transport.

Ship Conversion Market Report Coverage

Report Coverage Details
Base Year: 2022 Market Size in 2023: US$ 13.46 Bn
Historical Data for: 2018 to 2021 Forecast Period: 2023 - 2030
Forecast Period 2023 to 2030 CAGR: 7.7% 2030 Value Projection: US$ 22.63 Bn
Geographies covered:
  • North America: U.S. and Canada
  • Latin America: Brazil, Argentina, Mexico, and Rest of Latin America
  • Europe: Germany, U.K., Spain, France, Italy, Russia, and Rest of Europe
  • Asia Pacific: China, India, Japan, Australia, South Korea, ASEAN, and Rest of Asia Pacific
  • Middle East & Africa: GCC Countries, Israel,  South Africa, North Africa, and Central Africa and Rest of Middle East
Segments covered:
  • By Vessel Type: Container Vessels, Tankers, Bulk Carriers, Ferries & Passenger Ships, Offshore Vessels, Naval Vessels, Others (Tugs, Dredgers etc.)
  • By Services: Conversion, Repair, Maintenance, Refurbishment, Modernization, Life Extension, Others
  • By End Use: Commercial, Defense , Offshore, Passenger Transport  , Cargo Transport, Others
Companies covered:

Sembcorp Marine, Hyundai Heavy Industries, CSSC Chengxi Shipyard, Damen Shipyards Group, Cochin Shipyard, Fincantieri, Orient Shipyard, VARD Group, Wilson Sons, Oman Drydock Company, Bahri Abha Shipyard, Abu Dhabi Ship Building, N-KOM, Keppel Shipyard, Tebma Shipyards, Lamprell, Drydocks World, Dae Sun Shipbuilding, Shunzheng Shipyard, HHIC-Phil

Growth Drivers:
  • Increasing seaborne trade
  • Growth in ship building industry
  • Rising demand for conversion services
  • Need to comply with environmental regulations
Restraints & Challenges:
  • High cost of ship conversion
  • Long downtime required
  • Lack of adequate ship recycling facilities

Ship Conversion Market Trends:

  • Adoption of new technologies: Ship owners are increasingly adopting new technologies such as hybrid propulsion, batteries, fuel cells through conversions to enhance efficiency and comply with emissions rules. Electronic systems for navigation, automation and propulsion systems also see strong retrofitting demand. AI-based condition monitoring systems are being integrated into existing fleets.
  • Focus on operational efficiency: Obtaining higher operational efficiency is a key priority. Companies are offering comprehensive conversion solutions involving machinery upgrades, waste heat recovery systems, optimized hull designs etc. to improve ships' fuel economy, speed and payload capacity. Such efficiency improvements give asset owners better ROI.
  • Ship life extension services: With new ship builds becoming expensive, conversions are widely undertaken to extend the life cycle of vessels. By upgrading aged systems, refurbishing interiors and replacing corroded sections, ship life can be prolonged by up to 15 years. This provides better asset utilization and saves on new construction costs.
  • Transition towards gas-fueled engines: LNG is gaining wider acceptance as an alternative marine fuel. Converting conventional diesel-driven ships to dual fuel or gas-only engines is rising. Along with emissions compliance, the price advantage of LNG over other fuels is also driving such engine conversions and tank storage retrofits.

Ship Conversion Market Restraints:

  • High conversion costs: Ship conversions require extensive engineering changes and are capital intensive. The typical conversion costs vary from 25-40% of a comparable new build. Obtaining project finance for conversions is also difficult. The high costs involved hamper conversion demand from asset owners.
  • Longer time required: An average conversion takes 5-8 months at the yard compared to 2-3 months for simple repairs. The longer durations and resulting downtime lead to loss of revenues for ship owners. This acts as a key deterrent, especially for ship operators with tight operating schedules.
  • Overcapacity and volatile freight rates: Market challenges such as overcapacity, low charter rates and freight market volatility in segments like bulk shipping impact earnings of ship owners. Weaker financials limit their ability to invest in capital-intensive conversion projects to upgrade or modify ships until markets stabilize.

Recent Developments

New product launches

  • In January 2023, Damen Shipyards launched its Expedition Cruise Vessel ECS design tailored for the luxury adventure cruise segment. The innovative design provides higher passenger capacity along with range flexibility.
  • In September 2022, Hyundai Heavy Industries received an order to build four LNG-powered container vessels. The eco-friendly vessels will help reduce carbon emissions for ship owners.
  • In June 2021, Fincantieri delivered Seven Seas Splendor, an ultra-luxury cruise ship with expanded passenger capacity after its conversion and refitting. The ship provides enhanced onboard entertainment and dining options.

Acquisition and partnerships

  • In February 2022, Al Seer Marine acquired Bahri Dry Docking in Dubai to expand its ship maintenance and repair capabilities in the Middle East region.
  • In November 2021, Cochin Shipyard partnered with Fincantieri for technology transfer and joint development of civilian and defense vessels.
  • In May 2019, Damen Shipyards acquired Daewoo's Mangalia Shipyard in Romania to increase its ship repair and conversion capacity.

Figure 2. Global Ship Conversion Market Share (%), by Services, 2023

 | Coherent Market Insights

Top companies in Ship Conversion Market

  • Sembcorp Marine
  • Hyundai Heavy Industries
  • CSSC Chengxi Shipyard
  • Damen Shipyards Group
  • Cochin Shipyard
  • Fincantieri
  • Orient Shipyard
  • VARD Group
  • Wilson Sons
  • Oman Drydock Company
  • Bahri Abha Shipyard
  • Abu Dhabi Ship Building
  • N-KOM
  • Keppel Shipyard
  • Tebma Shipyards
  • Lamprell
  • Drydocks World
  • Dae Sun Shipbuilding
  • Shunzheng Shipyard
  • HHIC-Phil

*Definition: The Ship Conversion Market involves converting or retrofitting existing ships and vessels for purposes other than their original intended use. It includes upgrading ship systems and adding new capabilities through extensive structural modifications and installations. Ship conversions are undertaken to prolong the operational life of vessels, meet new environmental standards, enhance earning capacity or deploy them for alternative applications. The market comprises conversion service providers, equipment suppliers, ship owners and yard operators engaged in commercial and military ship conversion activities worldwide.

Few Other Promising Reports In Construction Engineering Industry

FTL and LTL Shipping Services Market

Shipping Containers Market

Shipbuilding Market

Ship-to-Shore Cranes Market

Frequently Asked Questions

The Ship Conversion Market is projected to grow at a CAGR of 7.7% from 2023 to 2030.

Asia Pacific is expected to lead the market.

The major players operating in the market are Sembcorp Marine, Hyundai Heavy Industries, CSSC Chengxi Shipyard, Damen Shipyards Group, Cochin Shipyard, Fincantieri, VARD Group, Oman Drydock Company and Abu Dhabi Ship Building. 

The leading component segment in the market is the container vessels segment. Container ships are increasingly undergoing conversions to meet changing cargo transportation needs.

The major factors driving the market growth are increasing seaborne trade, rise in shipbuilding activities, growing demand for energy efficient and eco-friendly vessels, expansion of the cruise industry and aging fleet replacement.
  • Need a Custom Report?

    We can customize every report - free of charge - including purchasing stand-alone sections or country-level reports

    Customize Now
  • Want to Buy a Report but have a Limited Budget?

    We help clients to procure the report or sections of the report at their budgeted price. Kindly click on the below to avail

    Request Discount

Reliability and Reputation

DUNS Registered
DMCA Protected


Joining thousands of companies around the world committed to making the Excellent Business Solutions.

View All Our Clients
trusted clients logo