The Japanese shipbuilder, Sumitomo Heavy Industries Marine and Engineering, has decided to stop taking new orders for commercial vessels. The shipyard will be making its exit from the shipbuilding industry after completing its current order log and will continue to operate the ship repair side of the business.
The shipyard is situated in Yokusaka and is best known for its aframax tankers, with the construction of more than a 100 aframax tankers under its belt.
Japanese shipbuilders have been facing cutthroat competition from shipyards in China and South Korea that are currently dominating the orderbook for shipbuilding in recent years.
The parent company, Sumitomo Heavy Industries, has stated that they are choosing to wind down operations because they are finding it challenging to sustain the shipbuilding business despite having implemented various measures, like overhauling its shipbuilding system and even resorting to limiting the number of vessel orders it accepts.
Elaborating further, the company stated that factors such as the rising prices of raw materials such as steel and other shipbuilding materials and equipment and the increasing supply and demand gap stemming from intense competition from overseas competitors are forcing the company to reevaluate its plans for the future. After careful deliberations, the company has decided that it will not accept any new orders for general commercial vessels in the 2024 financial year.
The shipyard has stated that they will continue to provide repair services and that the business will continue. Additionally, it plans to transition towards the renewable energy sector, intending to collaborate on vessels within that industry.
