Korean Shipbuilders Vexed by Cancelled Orders

Arirang News
Wednesday, November 07, 2012

Some owners are cancelling as they lack funds to complete the purchase of the ship.

Many of the orders are being cancelled after the ships have been built, as the buyers find they can't pay for the product amid worsening economic conditions, reports the Arirang News.

Samsung Heavy Industries, one of the four leading shipbuilders in Korea, has asked a client in Italy to change its mind about cancelling a contract for a medium-sized oil tanker, which was scheduled to be delivered by the end of the year.

According to Arirang News, many of Korea's shipbuilders are struggling with the same problem and the losses are even greater under a new payment method adopted in 2008 during the global financial crisis.

The previous top-heavy method called for five equal payments until delivery, guaranteeing the shipbuilder at least 60 percent of the price even if the buyer changed his mind. However, under the new payment system, known as the heavy-tail method, 70 percent of the money is paid after the contract cancellation deadline.

When the first orders under the new system were placed three years ago, the shipbuilders had hopes that conditions would pick up.

Source: Arirang News

 

Maritime Reporter June 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

Navios Announces VLCC Delivery

Navios Maritime Acquisition Corporation, an owner and operator of tanker vessels, has announced that the Nave Electron, a 2002-built VLCC of 305,178 dwt, was delivered

VIDEO: HMS Queen Elizabeth Floats Out

A timelapse video of HMS Queen Elizabeth floating out of her dock for the first time is now available at http://www.youtube.com/watch?v=P0ZjQz9vEKw. The float out of the 65,

GE, LR Study Gas Turbines for Commercial Ships

GE Marine and Lloyd’s Register Sign Memorandum of Understanding to Collaborate on Applying Gas Turbines to Power Commercial Ships GE Marine and Lloyd’s Register

Finance

Trading Dutch Well Placed to Pursue Russia Sanctions

The seafaring Netherlands prides itself on being a trading nation, reluctant to let politics get in the way of a good deal. But since the downing, allegedly

Navios Announces VLCC Delivery

Navios Maritime Acquisition Corporation, an owner and operator of tanker vessels, has announced that the Nave Electron, a 2002-built VLCC of 305,178 dwt, was delivered

Scorpio Tankers: Latest Financial & Ship Delivery News

Scorpio Tankers Inc. says it has updated its stock buyback program; lists its latest new vessel deliveries, and gives the release date of its second quarter 2014 earnings report.

 
 
Maritime Careers / Shipboard Positions Maritime Contracts Maritime Security Naval Architecture Navigation Pipelines Pod Propulsion Ship Repair Ship Simulators Winch
rss | archive | history | articles | privacy | terms and conditions | 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: 0.1082 sec (9 req/sec)