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

Shipbuilding

World’s Largest Boxship is DNV GL classed

CSCL Globe, the world’s largest containership and the first of a series of five 19,100 TEU containerships ordered by China Shipping Container Lines (CSCL) in 2013,

ESSA's Fleet Upgradation Environmental Driven

State-controlled Exportadora de Sal SA de CV of Mexico ("ESSA"), one of the world’s largest salt exporters with a 10-million-ton annual production, has strengthened

Kleven Wins New Yacht Contract

Norwegian ship builder Kleven has secured a new contract for a high specification, 116-metre long Expedition Support Vessel. The order is placed by Mr Graeme Hart,

Finance

Asia VLCC Rates Could Could Climb Even More

Owners see rates climb by nearly $22,000 per day; Rates could peak as more tonnage comes free. Rates for very large crude carriers (VLCCs) on key Asian routes

New Players in Singapore Markets in OW's Absence

The downfall of a leading marine fuel supplier that prompted sellers to tighten credit terms in Singapore is skewing the post-OW Bunker jostle for market share

Asian Airlines Pause Before Hedging on Fuel

Oil fell to four-year low of $72 on Thursday; Airlines hope the price will slip below $70 a barrel. Airlines in Asia-Pacific are holding off from hedging their

 
 
Maritime Contracts Maritime Standards Navigation Offshore Oil Pod Propulsion Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Sonar
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: 0.3267 sec (3 req/sec)