According to the Japan Ship Exporter’s Association (JSEA), Japanese yards' export ship contracted in 2011 is about 8.96m gt, down by 19.6% year-on-year and by two thirds from the peak in 2003.
Japanese shipbuilders are going through difficulties of decreasing order contracted, in a competiton with Chinese and South Korean builders, amid strong yen and decreasing newbuilding price.
Mitsubishi Heavy Industries forecasts CNY 8bn of operating loss for 2011 fiscal year (April 2011-March 2012) in its Shipbuilding & Ocean Development business, due to exchange-rate swing.
IHI and Kawasaki Heavy Industries are facing growing difficulties by cancellation or low newbuilding investment.
Moreover, as Japanese shipping companies, such as NYK, MOL, etc., suffering from fleet overcapacity caused by massive orders before Lehman Shock, are to withhold additional order placement for a while.
Japanese builders had had met several times of crisis by exchange rate or poor economic condition, however, many agree that this time is different.
The biggest problem is the advent of new global competitors, Chinese and Korean yards secured about 70% of overall global newbuildings in 2010. China's cost-competitiveness keeps pushing the price further down, in particular.