April 14, 2017 4:10 am JST

Hyundai Heavy to halt South Korean shipyard

Shipbuilder continues trimming production in response to weak demand

KENICHI YAMADA, Nikkei staff writer

SEOUL -- Hyundai Heavy Industries, South Korea's largest shipbuilder, will suspend operations at its shipyard in Gunsan amid a slowdown in orders for tankers and other vessels that looks unlikely to improve anytime soon, it was learned Thursday.

The Gunsan shutdown, to begin in June, is just the latest step taken by Hyundai Heavy to streamline production since last year. The company has already halted work at two of the 10 docks at its main shipyard in Ulsan in southeastern South Korea.

The Gunsan facility in the southwest employs an estimated 700 workers, 300 of whom have been moved to Ulsan. Hyundai Heavy appears to be considering transferring the remainder to subsidiaries, among other options. Shutting down the Gunsan shipyard's single dock will consolidate production at Ulsan.

A slump in ocean-freight rates has eroded worldwide demand for ships. Japan's Kawasaki Heavy Industries has announced plans to scale down its domestic shipbuilding operations by 30%.

Asia300

Hyundai Heavy Industries Co., Ltd.

South Korea

Market(Ticker): KRX(009540)
Sector:
Industry:
Producer Manufacturing
Trucks/Construction/Farm Machinery
Market cap(USD): 11,020.3M
Shares: 76M

Kawasaki Heavy Industries, Ltd.

Japan

Market(Ticker): TKS(7012)
Sector:
Industry:
Producer Manufacturing
Industrial Conglomerates
Market cap(USD): 5,049.43M
Shares: 1,670.81M

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