Japanese shipbuilders Tsuneishi Shipbuilding and Mitsui Engineering and Shipbuilding (MES) have reached an agreement to make a business alliance in the field of the design and construction of merchant ships.
The formation of the strategic alliance is aimed at attracting a higher order intake and achieving better cost competitiveness.
Under the deal, the duo plans to jointly operate Tsuineishi’s overseas shipyards, according to Nikkei.
The two shipbuilders said that they would continue to be managed independently and hold further discussions on the specific conditions of the alliance.
Japanese shipbuilders have been joining forces over the recent period as a means of combatting the industry downturn.
Namely, low ordering activity has seen many yards idle for quite some time and some of them were even forced to close down their business.
The number of active yards (those with at least one vessel of 1,000+ GT on order) fell from 440 at the start of 2017 to 360 as of start 2018, according to Clarksons’ data.
The consolidation drive has seen Mitsubishi Heavy Industries (MHI) launch talks on forming an alliance with compatriot Imabari Shipbuilding and Namura Shipbuilding in the commercial ship business as a way of strengthening their competitiveness on the market.
What is more, the country’s shipbuilding enterprises are faced with a very fierce competition from their Korean and Chinese rivals, which are estimated to hold 70 percent of the market.
World Maritime News Staff