Shanghai: More tales of woe regarding Grand China Logistics have emerged. Sources working at the company’s shipyard, Jinhai Heavy Industries, have told SinoShip News of severe financial troubles that has seen workers stage protests at the company’s consistent failure to pay wages. However, a spokeswoman for the yard has denied the scale of the financial mismanagement.
The yard has suffered from a series of cancellations, most notably from John Fredriksen. Most owners have been able to get out of contracts by citing scheduled delivery breaches of contract.
Grand China itself is involved in numerous legal cases over failed charter deals.
From a peak of around 10,000 workers, Jinhai’s total workforce, including subcontractors, has slumped to less than 1,000 today as it fights a drop in orders and the need to pay back loans in the region of RMB12bn.
“Labour unions have staged protests, shutdowns and defamation banners of the yard and its administration both on the shipyard island and at a neighbouring island,” a well-placed source said of the Zhoushan-located shipyard.
Unpaid equipment vendors have walked away from the yard, and there have even been regular power cuts as the yard struggled to pay its electricity bills on time.
While admitting the past year had been tough for Jinhai, a spokeswoman for the yard denied that employees were being paid late. She said that subcontractors might being paying their workers late, and as for equipment vendors, she said: “It is the industrial norm that we pay some deposit first, and pay the rest when we get the payment from the owners.”
Grand China took over Jinhai in 2009. The shipbuilder was founded in 2004, originally known as Jinhaiwan, and is among the largest on the shipbuilding archipelago of Zhoushan.
One bright spot is that the yard did receive its first offshore order towards the end of last year. [25/01/13]
