China's shipbuilding industry's overcapacity needs to be solved
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The gradual recovery of ship orders this year has just brought a touch of warmth to the Chinese shipbuilding industry, but the overcapacity has caused a cold snap to the shipbuilding industry.
“International Shipping China Annual Conference 2013†​​was uploaded. In the first three quarters of 2013, China’s shipbuilding capacity utilization rate was only 50%–55%, which was about 20% lower than the 75% utilization rate in 2012, far lower. The usual capacity utilization rate in the international shipbuilding industry.
“At present, the shipbuilding industry is at the bottom of the industry cycle. De-capacity will be a focus of the shipbuilding industry in the next two years.†Bao Zhangjing, director of the China Shipbuilding Industry Economics and Market Research Center, said that China’s shipbuilding capacity is expected to be higher than that in 2011. Cut by about 30%.
How serious is overcapacity?
How serious is the overcapacity of China's shipbuilding industry?
According to the "2013-2018 China Shipbuilding Industry Market Demand Forecast and Investment Strategic Planning Analysis Report", in 2012, the number of loss-making enterprises in China's shipbuilding and related equipment manufacturing industry reached 247, an increase of 39.55%; the total loss reached 10.457 billion yuan. The year-on-year growth was 233.34%; the asset-liability ratio reached 71.57%.
The overcapacity of the shipbuilding industry is also a global problem. Bao Zhang said that the current global shipbuilding capacity is 61.2 million CGT correction tons, and the three major shipbuilding companies in China, Japan and Korea can account for 90% of the world. The global average annual turnover of ships in 2013–2015 is estimated to be 32 million CGT, and the global overcapacity will exceed 50%. Shipbuilding companies are generally faced with insufficient orders.
According to data released by China Shipbuilding Industry Association, from January to September this year, the national shipbuilding completion was 30.61 million DWT, down 26.4% year-on-year; 80 key monitoring enterprises in the shipbuilding industry achieved a revenue of 182.31 billion yuan, a year-on-year decrease of 15.8%. The total profit was 4.9 billion yuan, a year-on-year decrease of 53.9%. From January to September this year, the country's orders for new ships were 38.06 million DWT, a year-on-year increase of 147.1%. "The rebound in new ship orders will further delay the shipbuilding industry's capacity-consuming process." Participants said.
At the same time as the total surplus, the problem of structural excess is also very serious. Low level, homogenized capacity, and lack of high-end capacity. Bao Zhangjing said that among the ships completed in China in 2010–2012, the proportion of 70% of the deadweight tonnage is at the low end of the bulk carrier.
Encourage the transfer of existing production capacity to offshore engineering to resolve overcapacity problems. The state has successively issued documents such as “Implementation Plan for Accelerating Structural Adjustment and Promoting Transformation and Upgrading of Shipbuilding Industry 2013–2015†to encourage the transfer of existing shipbuilding capacity to the offshore engineering equipment field.
Long before the opinions were issued, powerful shipyards were actively marching into the offshore industry. China Heavy Industries and China Ships are vigorously promoting the proportion of offshore equipment.
Xie Weiyi, brand marketing manager of COSCO Shipyard Engineering Group Co., Ltd. said that an important measure for the company to reduce production capacity is to reduce the original shipbuilding business and turn to offshore equipment manufacturing and ship repair business. The company's shipyards engaged in the production of offshore equipment have expanded from one plant last year to six plants this year. “The cost of a jack-up offshore drilling platform is about 200 million US dollars, and the cost of a 100,000-ton oil tanker is about 50 million US dollars. In the current shortage of shipbuilding orders, the shift to offshore equipment manufacturing has a significant effect on the company's profit. Zhang Xinlong, deputy dean of China Shipbuilding Industry Comprehensive Technology and Economic Research Institute, believes that at present, the traditional shipbuilding industry has passed the peak of the development life cycle, and the offshore equipment manufacturing industry is in the upward development stage.
However, Xie Weiyi also expressed his concern. "Now many shipbuilding companies are turning to offshore equipment manufacturing. In the past two years, there may be overcapacity in the shipbuilding industry." According to industry insiders, China currently has offshore engineering vessels. Nearly 100 shipbuilding companies have built their capabilities, and their expansion rate is shocking.
Banks and enterprises strongly support restructuring and integration. “The low valley period is a good time for the merger and reorganization of the shipping industry.†Liu Xiaodan, president of Huatai United Securities, said at the annual meeting.
The previously issued "Guiding Opinions of the State Council on Resolving the Contradictions of Severe Overcapacity" also proposed to support the merger and reorganization of shipbuilding enterprises and increase industrial concentration.
The chairman of the China Banking Regulatory Commission, Shang Fulin, publicly stated at the beginning of this month that he should treat the overcapacity industry differently and support the merger and reorganization of the company to integrate production capacity. The term of the M&A loan can be extended from the original five years to seven years.
In this regard, analysts believe that the merger and reorganization of the domestic shipbuilding industry is undoubtedly the two major state-owned groups of China Shipbuilding Industry Corporation and China State Shipbuilding Corporation, and CSIC and China Ships are listed as the flagships of the two major groups. It is possible to become a listed company that assumes the role of mergers and acquisitions integrators. In addition, some of the shipbuilding enterprises with strong comprehensive strength and good capital status are also expected to become potential integrators in the industry.
"Diversion" to find out the road For the shipbuilding industry, the task of resolving excess capacity is arduous, just like "Huashan Road", only the challenge is up, there is no other path to choose. But how to resolve excess capacity? It is a serious challenge in front of the industry.
The author believes that the overcapacity of the shipbuilding industry, the main "remaining" in homogenization - when 70% of companies together grab 30% of the orders, the contradiction of capacity is undoubtedly prominent.
The State Council issued the "Guiding Opinions on Resolving the Contradictions of Severe Overcapacity in Production Capacity" in October this year, and proposed the path of "digesting a batch, transferring a batch, integrating a batch, and eliminating a batch" of capacity, which is also the "diversion" of the shipbuilding industry. Achieving the problem of dislocation competition, differential management, and characteristic development.
How to “divide†into the enterprise? In fact, there are many choices: the offshore industry is undoubtedly the most attractive “new position†for industrial transfer, and the domestic demand potential of marine equipment in the fields of fisheries, administrative law enforcement, emergency rescue, etc. is also very large; A shortcut to form a core competitiveness; the use of "empty window period" for software and hardware upgrades, to "high-precision" development, will also adjust the production capacity layout for enterprises.