[Courtesy of Hyundai Heavy Industries]
South Korea's Hyundai Heavy Industries warned Tuesday that a prolonged business slump was pressing the world's largest shipyard to make an unprecedented choice of closing some of its dry dockyards temporarily.
The warning came at the start of wage negotiations between Hyundai Heavy CEO Kwon Oh-gap and union leaders at the company's main shipyard in the southeastern industrial city of Ulsan.
"The suspension of operations at our docks is being realized, and we are also seeing a 30 percent drop in our work at other business sectors," he said, appealing for help from workers to ride out the company's crisis.
No related figures were given, but the shipyard has been suffering from a dearth of fresh orders this year. Hyundai Heavy has 10 docks, and its two sister shipyards have seven.
Hyundai Shipyard has vowed to push ahead with the aggressive streamlining of its bloated structure as well as the sale of non-core assets.
For years, the shipyard has made rigorous restructuring and cost-cutting efforts to improve its financial status as a slide in oil prices has caused a decline in new orders for facilities. But it suffered a second consecutive year of deficit due to increased costs from a delay in the construction of offshore facilities and order cancellations.
In the first quarter of this year, the shipyard won $1.74 billion worth of overall orders, down 42.3 percent from a year earlier. Its shipbuilding orders tumbled 63 percent on-year to $234 million.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
