Japanese Shipbuilding Giants Cut Their Losses

Tuesday, April 03, 2001
Japan's Kawasaki Heavy Industries Ltd. and Ishikawajima-Harima Heavy Industries Co. Ltd (IHI) said on Tuesday they would integrate their loss-making shipbuilding divisions in October 2002.

News of the alliance was welcomed by investors, who sent shares in Kawasaki Heavy up five percent to 168 yen while IHI closed at 272 yen, gaining 7.5 percent.

The alliance of Japan's second- and third-biggest heavy machinery and ship makers, intended to bring them back to profitability, reflects growing competition from Korean shipbuilders able to take advantage of low manufacturing costs and a weak won.

The two companies will form a 50-50 joint venture based in Tokyo and will make joint use of Kawasaki's plants in Kobe and Sakaide and IHI's plants in Yokohama and Kure, they said. The company will target annual sales of 200 billion yen ($1.5 billion) in the year to March 2005 with a ratio of current profit to sales at two to three percent, they said.

Two firms had initially planned to integrate their shipbuilding businesses with that of sixth-ranked Mitsui Engineering & Shipbuilding Co. Ltd., whose shipbuilding operations are profitable. Kawasaki and Mitsui Engineering began cooperating in 1999 on procurement, market research, design and output, and IHI joined the alliance late last year. However, Kawasaki and IHI said Mitsui Engineering would not be joining for the time being. They gave no reason. The two firms employ a combined 3,712 people in their shipbuilding businesses and all will move to the new venture.

Maritime Reporter March 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

BIMCO Welcomes EU Decision on Migrants

BIMCO has stated today that it appreciates the new efforts by EU leaders to reduce increasing reliance on merchant shipping to rescue the growing numbers of

Long Beach, Los Angeles ports host forum to gather input

More than 100 cargo owners, trucking firm leaders, longshore labor, marine terminals and other goods movement industry representatives turned out Wednesday for

Arctic Nations to Fight Climate Change Despite Russia Tensions

The eight Arctic Council nations pledged on Friday to do more to combat climate change that is shrinking the vast frigid region, with countries trying to put

 
 
Maritime Security Naval Architecture Navigation Offshore Oil Pod Propulsion Port Authority Salvage Ship Electronics Sonar Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1552 sec (6 req/sec)