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Tuesday, September 29th, 2020

Rough sailing for Chinese shipyards

by August 27, 2016 General

Beijing (AsiaNews/Caixin) – China’s largest private shipbuilder, Yangzijiang Shipbuilding Holdings, laid off 6,000 workers last year and plans to cut another 2,000 jobs this year. This comes as profits drop and new orders dry up.

In early 2015, the Singapore-listed company had 28,000 workers. Now it plans to cut up to 28 per cent of its workforce.

The company reported a 50 per cent decline in profits in the first half of the year, compared to last year. Revenue declined by 35 per cent.

Because of the global economic crisis, the shipbuilding industry is in crisis everywhere and there are no signs of recovery.

Chinese shipbuilders have been struggling with overcapacity and empty order books as the global shipping industry continues to lose steam.

Private shipbuilders are also struggling with access to finance from banks and the increasing risk of payment delays or defaults from ship owners.

State-owned counterparts have survived propped up by government subsidies.

Last year, a number of private shipyards such as Jiangsu East Heavy Co., Zhejiang Zhenghe Shipbuilding Co. and Nantong Mingde Heavy Industry Co. filed for bankruptcy.