Japan is currently exploring the possibilities to integrate 15 major shipyards in the country under a so-called All Japan Shipbuilding merger plan, following similar steps by neighbouring shipbuilding rival countries China and South Korea, local financial newswire Nikkei is reporting.
The merger plan comes after Japan’s largest two shipbuilders – Imabari Shipbuilding and Japan Marine United (JMU) – declared in December they would form an alliance and enter into a capital tie-up.
To move forward with the tie-up, Imabari and JMU recently announced that they would form a joint venture by March 31, 2021, to integrate sales and design business for bulker and tankers. Imabari and JMU will hold 51% and 49% shares in the joint venture respectively.
The All Japan Shipbuilding merger plan is led by Japan’s Ministry of Land, Infrastructure, Transport and Tourism (MLIT), which has entered preliminary discussions with some domestic yards.
Besides the tie-up between Imabari and JMU, Mitsubishi Heavy Industries also announced a plan at the end of last year to sell one of its largest yards to compatriot Oshima Shipbuilding. Another two major Japanese shipbuilders Mitsui E&S and Tsuneishi Shipbuilding both have a shipbuilding presence in China and the two entered into business partnership for commercial shipbuilding back in 2018.
Japan is currently the third largest shipbuilding nation in the world after South Korea and China. It had been the largest shipbuilding nation in the world through to the turn of the century at which point cheaper neighbouring rivals expanded at its expense.
Last year, the two largest shipbuilding groups in China – CSSC and CSIC – started a merger by creating China Shipbuilding Group, while two major South Korean yards – Hyundai Heavy Industries (HHI) and DSME – are also in the process of merging.
In February, the Japanese government filed a petition at the World Trade Organization (WTO), questioning the legitimacy of the merger between HHI and DSME.