Korean Shipyards to Win Mega Shipbuilding Deal

Image Courtesy: businesstimes.com.sg

Yonhap News reported yesterday that according to industry sources, two South Korean shipbuilders, Samsung Heavy Industries Co. and Daewoo Shipbuilding & Marine Engineering Co., are expected to win a combined USD 1.5 billion deal.

The news comes as welcome relief to the shipbuilders who are presently reeling under delays and cancellations. As per the report, MSC is close to a deal with Samsung Heavy for up to six 22,000-TEU vessels and is expected to turn to Daewoo Shipbuilding for a further five.

Although early in the year local shipyards received new orders that exceeded expectations, recent times presented obstacles in earning more contracts.

As reported earlier, South Korean shipbuilders have suffered major financial strain since the global economic crisis of 2008. It was during this time that new orders ceased amid a glut of vessels and these shipyards experienced tougher competition from Chinese rivals

In 2016, out of the three big shipbuilding companies, only Hyundai Heavy managed to post profits.