Japanese Shipbuilding Companies Reopen Production Plants

May 11 (EIRNS) -- Three big Japanese shipbuilding companies are re-opening production plants because of the demand of the growing economies of the BRICs (China, Russia, India, and Brazil). "The volume of sea transport is increasing more and more as economy becomes more global. It is also because of the growing economies of the BRICs," Yasumi Makimura, a spokesman for the Shipbuilders Association of Japan, told Bloomberg today.

For the first time since 1996, the Ishikawajima-Harima Heavy Industries Co. will resume building cargo ships, at its plant in Aichi prefecture, spokesman Keiichi Sakamoto told Bloomberg. When production re-starts in October, it will be the first increase in Ishikawajima-Harima industries production in 30 years, and could result in a 20% increase in production capacity.

Kawasaki Shipbuilding is to invest over US$80 million to increase capacity in its plant in Sakide by March 2009, according to Kawasaki Heavy Industries spokesman Katsuhiro Sato. Mitsubishi Heavy Industries will invest a similar amount over two years in its plant in Nagasaki.

This is the first such expansion in Japanese shipbuilding since the severe "downsizing" in the 1970s and 1980s and subsequent government regulations against increasing production capacity, which were in effect until 2003. Japan used to produce 50% of the world's ships, and now makes about 33%, with South Korea producing 38%.