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Top shipbuilders clinch zero deals in April

All News 09:23 April 30, 2016

SEOUL, April 30 (Yonhap) -- South Korea's top three shipbuilders failed to clinch a single deal in April, industry data showed Saturday, casting concerns that the firms may roll out possible restructuring of their workforces.

Local shipbuilders only managed to win five construction deals over the first four months of this year, which is only around 5 percent of the average amount posted in previous years.

Daewoo Shipbuilding & Marine Engineering Co. and Hyundai Heavy Industries Co., failed to win any deals in April. Samsung Heavy Industries Co. has not earned any orders this year for the first time.

Industry watchers cited the rise of Japanese and Chinese players as one of the major hurdles for local shipbuilders.

"Before April, local firms managed to win a few deals. But as Chinese firms raked in global orders on the back of their price competitiveness, South Korean shipbuilders' global presence has narrowed," an industry official said.

"The real problem is that there are no signs of recovery this year," the official added. Other industry watchers said the slump may continue throughout next year as well.

In 2015, local shipbuilders faced one of their most turbulent years. The top three players racked up a combined loss of 7.7 trillion won (US$6.7 billion) last year while they failed to clench any new significant orders amid an industry-wide slump.

While local shipbuilders can manage to survive this year due to deals clinched earlier, industry watchers said the real struggle may begin next year, when they run out of orders.


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