Bloomberg News

Lloyd’s Register Speaks About China’s Shipbuilding Industry

May 15, 2012

The Chinese shipbuilding industry, the world’s biggest, is focusing on quality over productivity and overcoming deficiencies, including worker training, retention and research and design, Lloyd’s Register said.

Following are comments from Tom Boardley, marine director of Lloyd’s Register, a London-based classification society that monitors compliance with structural rules for building ships. The company is the world’s second-largest society, covering 18 percent of the global fleet, and it employs 372 people in China, working at 40 of the country’s 200 main yards, he said, speaking at the China Money & Ships conference in London today.

“We know that the yards have had severe difficulties recruiting, not so much recruiting but in retaining qualified management and workers,” he said, adding that China’s economy has been booming.

“As soon as they’re well trained they go back home for Chinese New Year or holidays and they then discover they can get a job there. There’s been a huge turnover in staff. But hopefully with things slowing down, we’re hoping that will change.

‘‘For a lot, productivity came first and quality a little bit later. But certainly all major shipyards have quality as a major part of their program and we’ve seen them take huge strides.

‘‘They were originally offering standard designs and quick delivery and a good price and that’s what the owner wanted. Now everyone is looking for the best design, an eco-friendly design and what we’re seeing now is Chinese yards are showing a huge amount of flexibility and user friendliness in terms of being able to offer new designs to shipowners in order to make sure they can secure orders.

‘‘Subcontractor turnover has reduced and that’s been a major problem for yards, which are now investing in training and development.

‘‘With the financial slowdown, a lot of the yards have slowed down their productivity in order to try to improve quality. Clearly the potential downside is that people are cutting corners, trying to use cheaper components, trying to use subcontractors and to be realistic this is a potential downside. ‘‘Obviously it’s caveat emptor (buyer beware) to the buyer.

‘‘One of the biggest issues, and no surprise to ship owners, is the quality of welding in China. It is a constant battle because the training isn’t particularly good and a lot of people claim to have welding qualifications that when tested prove to be somewhat lacking.

‘‘I know a lot of the shipyards now are very rigorous in making sure that welders are welding to the standards that are required.’’

To contact the reporter on this story: Michelle Wiese Bockmann in London at mwiesebockma@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net


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