China's Shipbuilding Surge: New Times Expands with Massive Drydock Approval
China's shipbuilding giant, New Times, has secured government approval to expand its facilities with a new massive drydock, signaling a significant expansion in its capacity. The company is continuing to meet the growing demand for its products and services by placing new orders and expanding strategically.
(Photo : Unsplash/Isaac Chou )
New Times Expands Shipbuilding
Local authorities have given the green light for New Times Shipbuilding, one of China's biggest privately held shipyards, to construct a second drydock, and the company has sold several slots for the expansion. In recent weeks, New Times has successfully completed a series of containership orders for the 700-meter-long new drydock, with delivery scheduled for 2027 and 2028.
The number of active yards has increased by 17.7% in the past two years, indicating that Asian shipyards are capitalizing on the new building boom. Based on the shipping organization BIMCO, the global order book for shipyards currently stands at more than 133 million compensated gross tonnes (CGT). This mark represents an increase of 56 million CGT compared to the order book's most recent low, which occurred in late 2020.
As mentioned, both LNG and containerships have contributed to the growth, with the former accounting for 35% and the latter for 30%. Hengli Heavy Industry is one of many Chinese yards establishing new facilities to accommodate the extreme demand for its products. The company intends to increase its annual shipbuilding capacity to 7.1 million tons, more than twice its current output.
Moreover, according to Stuart Nicoll, director of Maritime Strategies International, a consultancy based in the United Kingdom, the reorganization and consolidation observed in the shipbuilding industry over the past few years has improved organization regarding the flow of materials.
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Concerns Over China's Shipbuilding Industry
The Chinese shipbuilding enterprise represents the most current flashpoint in the rising tensions between Washington and Beijing. While President Joe Biden's government concentrates on the claimed unfair economic practices leading to China's development as the biggest shipbuilder in the world, broader national security issues are at play. Beijing's continuous naval development is being accelerated by the influx of foreign cash and technology into Chinese shipyards of dual-use construction.
According to a statement made by President Joe Biden on April 17 from the headquarters of the United Steelworkers in Pittsburgh, he pledged to conduct a thorough investigation of the Chinese industrial strategies that have helped the country's shipbuilding industry. The United States Trade Representative opened a Section 301 inquiry on the same day, looking into allegations that China used nonmarket activities to impede competition in the worldwide shipbuilding sector.
As the United States and China's trade dispute expands beyond technology into manufacturing, the United States opened an investigation into China's dominant shipbuilding industry in April, which reportedly added additional pressure to China.
The Ministry of Commerce issued a statement in which it stated that China is adamantly opposed to the probe, which is an additional error on top of the initial error. This petition, which lacks a factual basis and runs counter to common-sense economics, misinterprets regular trade and investment operations as harmful to the national security and business interests of the United States of America. Additionally, it blames China for the problems the United States is experiencing in the industrial sector.
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