ULSAN < invest Korea

According to Yonhap News,

(SEOUL=Yonhap News) Hyundai Heavy Industries Co., a major shipyard in South Korea, maintained its status as the third-largest player in order backlog in January, after being relegated to the spot the previous month, industry data showed Monday.

According to the data compiled by global research firm Clarkson Research Services, Daewoo Shipbuilding & Marine Engineering Co., another South Korean shipbuilder, ranked first in terms of order backlog as of January with 6.6 million compensated gross tons (CGTs) to build 99 ships, followed by Imabari Shipbuilding Co. of Japan with 5.97 million CGTs, or 188 vessels, and Hyundai Heavy with 5.44 million CGTs, or 123.

Imabari Shipbuilding took on Hyundai Heavy in December last year, after rising to the third spot in November 2016 by demoting another South Korean shipbuilder, Samsung Heavy Industries, to fourth place.

An order backlog is a barometer of a shipyard's capacity and its future growth, but local shipyards have been suffering from a sharp drop in new orders.

The shipbuilding industry, once regarded as the backbone of the country's economic growth and job creation, has been reeling from mounting losses caused by an industrywide slump and increased costs.

The country's top three shipyards suffered a combined operating loss of 8.5 trillion won (US$7.4 billion) in 2015 due largely to increased costs stemming from a delay in the construction of offshore facilities and the industrywide slump, with Daewoo Shipbuilding alone posting a 5.5 trillion-won loss.

The shipbuilders have drawn up sweeping self-rescue programs worth some 11 trillion won in a desperate bid to overcome a protracted slump and mounting losses.

sam@yna.co.kr

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