Asia/Pacific News
HHI to Raise Prices, Shipping Lines "Willing to Pay a Bit More" for Eco-Ships
South Korean shipbuilder Hyundai Heavy Industries Co. (HHI) will raise prices as the demand for fuel-efficient vessels boosts its sales, Bloomberg reports.
Executive Vice President Ka Sam Hyun said orders this year may exceed the target of $11.3 billion even as Chinese shipyards suffer from falling demand.
"The big focus right now is on fuel efficiency," Ka said.
"At a time when prices have fallen so much, shipping lines seem to be willing to pay a bit more to get better performing ships on time.
"This is why the top-tier shipyards will benefit."
South Korean yards are particularly focused on the largest container ships, the area that shipping lines are most interested in today.
About 483 Chinese shipyards received $10.5 billion in orders in the first half of 2013, while 94 builders in South Korea received $18.5 billion, according to Clarkson Plc.
Chinese shipyards are more focused on bulk carriers, and their orders have fallen due to surplus tonnage and difficulties in the global economy.
"The Chinese shipbuilding industry is still facing unprecedented challenges," China Rongsheng Heavy Industries Group Holdings Ltd. (Rongsheng) said in a statement.
"Demand in the global shipbuilding market has continued to decline and prices for new vessels have failed to rebound."
Chinese shipbuilders have also been working to expand their oil-rig businesses to offset declines in shipbuilding.
A report last year said that half of Chinese shipyards face bankruptcy, and that reducing the number of players in the market could allow surviving firms to improve their finances.
