[Yonhap News Photo]
Daewoo Shipbuilding and Marine Engineering said Friday it has forged a crucial partnership with US defense giant Lockheed Martin to develop new warships as the world's third-largest shipyard is faltering because of a prolonged business slump.
Daewoo has been South Korea's leading producer of warships and submarines and posted sales of one trillion won in its defense-related business last year, although production of commercial ships has been in deep trouble.
Last year the shipyard, hit by a delay in the construction of offshore facilities and the cancellation of orders, posted a record net loss of 5.13 trillion won (4.46 billion US dollars), compared with a profit of 33 billion won a year earlier. Sales tumbled 23 percent on-year to 12.97 trillion won.
Like other South Korean shipyards, Daewoo was the victim of a protracted slump in the global shipbuilding industry. Demand has been weak due to low oil prices while competition with Chinese rivals has intensified.
Daewoo, however, hailed its tie-up with Lockheed as an example of how South Korea shipbuilders should go forward to ride out their crisis, saying it would team up with Lockheed to develop new and advanced battleships for global sales.
Daewoo has clinched foreign orders to build 14 warships so far. In March, it launched the first out of the three diesel-electric submarines for service in Indonesia under a $1.1 billion contract. The first 61-meter vessel, which displaces 1,400 tons, is now undergoing sea trials before being delivered in March 2017.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
