KHI shifts construction to China

JAPAN’S Kawasaki Heavy Industries (KHI) is to shift merchant ship construction from Japan to China and reduce the scale of its domestic business by 30 per cent while trying to establish itself as a specialist for gas carriers and gas-powered vessels.

The move comes following a slump in the shipbuilder’s Ship & Offshore Structure segment in the past few years, as well as large losses in the past two years, which prompted the establishment of a restructuring committee in October 2016.

The committee has judged that, although there is still no resolution in sight for the excessive construction capacity, the growth in the demand for liquefied natural gas (LNG) and liquefied petroleum gas (LPG) and the strengthening of environmental regulations is a good opportunity for KHI.

KHI also plans to reduce invested capital through the reduction of inventories and fixed assets, in addition to concentrating domestic merchant ship construction in Sakaide Works, where KHI will utilise gas related technology and environmental load reduction technology and reduce the number of orders accepted with a focus on gas-related ships.

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