Politics and the Economy in Shipbuilding: Germany in the Face of International Competition

Shipbuilding is far more than just an industrial sector – it is the strategic backbone of the maritime economy and defence. How Politics and the Economy shape the German shipbuilding industry, the role played by maritime strategy, EU programmes and government subsidies, and why German suppliers account for the most significant part of the value chain.

Estimated reading time: 9 minutes

What influence do politics and the economy have on shipbuilding?

Shipbuilding is a strategically important part of the maritime economy and the defence industry. Shipyards and suppliers provide the technical foundations for maritime transport, energy supply and the protection of maritime infrastructure. A strong shipbuilding industry therefore contributes to Germany’s capacity to act in the areas of the economy and security policy.

How do geopolitical upheavals shape maritime strategy?

Economic competition, geopolitical conflicts and environmental challenges are shaping the maritime policies of Germany and the European Union. In this context, secure supply chains, industrial autonomy and the protection of maritime infrastructure are becoming increasingly important. The political, business and research sectors must work together to strengthen the competitiveness of the German shipbuilding industry and drive forward technological innovation.

What are the objectives of Germany’s maritime strategy?

Germany’s maritime policy comprises various strategies and support measures for shipbuilding and the maritime economy as a whole. Its objectives include strengthening innovation, maintaining industrial value creation and safeguarding skilled jobs.

Strengthening our capacity for technological innovation
This will ensure that Germany remains competitive in the future.

Preserving the industrial value chain
These include high-capacity shipyards, suppliers and development firms. German companies can also benefit by supplying components and systems for ships built abroad.

Safeguarding shipbuilding jobs in Germany
This ensures that Germany retains the experience and technical expertise required for shipbuilding.

What role does the National Maritime Conference play?

The National Maritime Conference is a key event organised by the Federal Government to support the maritime industry. It brings together representatives from politics, business, trade unions and academia. Together, they discuss challenges and measures to strengthen Germany’s position as a maritime hub. These include, amongst other things, innovation, climate protection and the sector’s competitiveness.

How does the EU support green and digital shipbuilding?

The European Union supports the development of low-emission ships and the digitalisation of shipbuilding. To this end, the „Horizon Europe“ research and innovation programme funds projects focusing, amongst other things, on alternative propulsion systems, energy efficiency and digital manufacturing. The European Green Deal provides an overarching political framework for the climate-neutral transformation of the economy; it is not a single funding programme.

Read the article to find out which technologies are shaping the green and digital transformation in shipbuilding – from alternative propulsion systems to smart green ships. Digitalisation in yacht and shipbuilding: smart ships and digital twins.

How does government funding differ when compared internationally?

State support influences international competition in the shipbuilding industry. However, the nature and extent of such support differ significantly between China, Japan and South Korea. The instruments used include, for example, grants, tax breaks and preferential financing. The OECD draws particular attention to the extensive support provided to Chinese shipyards and the resulting distortions of competition.

In Germany, research, development and innovation are key priorities for shipbuilding funding. The Maritime Research Programme supports the development of new maritime technologies. In addition, the programme „Innovative Shipbuilding Secures Competitive Jobs“ provides funding for innovative products and processes in specific shipbuilding, repair and conversion projects.

Differences in funding conditions can affect the competitive position of shipyards. In addition to government support, production capacity, labour costs, supply chains and specialisation also play a role. Large shipyards can benefit from economies of scale, particularly when building standardised merchant vessels.

For German shipyards, technological innovation, quality, specialisation and the integration of complex systems are key competitive factors. The supply industry also contributes to international competitiveness through its products and development expertise. Whilst these strengths offer opportunities, they do not guarantee a consistently stable order book or the preservation of all jobs.

How important are German suppliers to value creation in shipbuilding?

A large proportion of international shipbuilding capacity has shifted to Asia, and this is also having an impact on Germany. However, that does not mean that the shipbuilding industry here is left empty-handed.

Value creation in shipbuilding encompasses far more than just the construction of the hull. It also includes the development, manufacture and integration of propulsion systems, power supply systems, control technology and other on-board systems. German suppliers can contribute to these services with their specialised products and technical expertise.

German suppliers also supply shipyards in Asia. Their product range includes, for example, diesel engines, drive shafts and propellers, as well as power, control, safety and navigation systems.

German and European companies can be involved in shipbuilding projects in Asia by supplying components and systems. This creates export opportunities, even if the ship is built abroad. The proportion of value added that remains in Germany or Europe depends on the specific project and the suppliers involved.

What is the market breakdown in the global shipbuilding industry?

Global merchant shipbuilding is heavily concentrated in East Asia. According to UNCTAD, in 2025 around 91 % of the gross tonnage of completed vessels was accounted for by China, South Korea and Japan. This figure describes the volume of construction measured in terms of ship tonnage, not the proportion of the total number of vessels built.

In Germany and the European Union, too, shipbuilding is supported by public measures. These include funding for research and innovation, as well as public procurement contracts. In March 2026, the European Commission also presented a maritime industrial strategy designed to strengthen competitiveness, technological development and industrial resilience. The economic difficulties faced by individual shipyards cannot therefore be explained solely by a lack of state support.

How do naval contracts stabilise the German shipbuilding industry?

Contracts for the German Navy can ensure capacity utilisation at the participating shipyards and supplier companies over extended periods. They help to maintain technological expertise and can promote developments in areas such as materials science, sensor technology and propulsion systems. This benefits, in particular, the companies and employees involved in these projects. However, it does not compensate for fluctuations in the civilian shipbuilding sector across all businesses.

What sort of skilled workers does the German shipbuilding industry need?

Whether it is naval projects, major civil contracts or specialist supply companies, the German shipbuilding industry needs qualified skilled workers. Workers from other European countries can help to fill vacant posts. The key factors are the qualifications, professional experience and, where applicable, additional evidence required for the role in question.

Welder & CNC operator
Precision work in hull and component construction, including for naval projects

Electricians & Electronics Technicians
Safety, navigation and control electronics

Mechanics & Industrial Mechanics
Drive shafts, propellers, power and propulsion systems

Pipe fitters & pipework installers
On-board supply and fuel systems

Shipbuilder & Steelworker
Fuselage and section construction, structural work

---

Enquire about skilled shipbuilding workers from Eastern Europe

Are you looking for qualified welders, electricians, mechanics or shipbuilders for commercial or naval projects? We provide experienced staff from Poland, the Czech Republic, Romania and other EU countries – quickly, in full compliance with the law and with the right qualifications.

---

Frequently asked questions

Why is shipbuilding so strategically important for Germany?

Shipbuilding provides key technical foundations for maritime transport, energy supply and maritime defence. High-performing shipyards and suppliers help to preserve industrial expertise and strengthen Germany’s capacity to act in the areas of the economy and security policy.

How does the EU support the shipbuilding industry?

The EU supports research and innovation in shipbuilding through, amongst other things, „Horizon Europe“. Funding is provided, for example, for developments in low-emission propulsion systems, energy efficiency and digitalisation. The European Green Deal provides an overarching policy framework for this; it is not a standalone funding programme.

How does Germany benefit from shipbuilding in Asia?

German suppliers can provide components and systems for ships being built at Asian shipyards. These include, for example, propulsion systems, power supply systems and navigation electronics. This enables German companies to profit from international shipbuilding projects, even if the ships are built abroad.

How does government funding in Asia differ from that in Germany?

The nature and extent of state support vary considerably from country to country. The OECD highlights, in particular, the extensive support provided to Chinese shipyards. Germany supports research and development, as well as the implementation of innovative products and processes in specific shipbuilding projects.

How can supplier companies meet their demand for skilled workers?

Depending on their line of work, supply chain companies may require, for example, qualified welders, mechanics and electronics technicians. Recruiting suitable skilled workers from other EU countries can help to fill vacancies. In doing so, the technical requirements and the legal conditions of the relevant employment model must be taken into account.

What is the legal procedure for seconded EU staff?

When posting workers from another EU Member State to Germany, the applicable working conditions, social security requirements and, where applicable, registration obligations must be observed. These include, in particular, the A1 certificate as proof of the applicable social security legislation and any necessary declarations to customs. In the case of temporary agency work, the requirements of the Temporary Agency Work Act (AÜG) also apply. The agency generally requires a corresponding licence for this purpose.

Do you need shipbuilding subcontractors on a contract basis instead of temporary labour? Our sister platform takes care of that zeitarbeit-international.de.