Shipbuilder to the World

Like huge Japanese lanterns, the harbors along Japan's jagged coast sparkled at night last week with the blue fire of acetylene welding rods and the white glare of arc lights. The lights burned overtime as Japan worked to meet the greatest shipbuilding boom in its history. All 54 ways at Japan's nine major shipyards are occupied; one ship is barely launched before a new keel is laid.

Ingenious Engineering. Japan's shipbuilding boom is all the more amazing because the rest of the world's shipyards are suffering from a lack of new orders. Such a lion's share of the business is going to Japan that it now has shipbuilding orders for 4,000,000 gross tons worth $750 million--a backlog big enough to keep its yards working for two years. How did Japan corner 27% of the world's ship construction?* Because steel and labor are cheap in Japan, Japanese shipbuilders are able to sell tankers and freighters for 30% less than the U.S. and 15% less than the Europeans. By using such production-line methods as fabricating large ship sections separately and then welding them together, the Japanese yards can turn out ships in about one-third less time than their competitors. The Japanese also offer easy credit.

Such considerations aside, the Japanese during the past few years have won an enviable reputation for ingenious engineering. Tokyo's Mitsubishi Shipbuilding & Engineering, the world's largest shipbuilder, has launched an 11,000-ton freighter whose "bulbous bow" (like a nuclear sub's) enables it to cruise at 20 knots on 25% less fuel than conventional ships. Kobe's Kawasaki Heavy Industry recently launched a 29,000-ton tanker whose engine and control systems are so highly automated that it is manned by only 31 crewmen v. 62 for comparable tankers. Also at Kobe, Mitsubishi Heavy-Industries is experimenting with a "pin-joint" design for large tankers; the ship would bend slightly at midships to ease the strain from the waves and thus be less expensive because it would need less steel for structural strength.

Wiped Out. A cornerstone of the country's economy, Japan's shipbuilding industry provides jobs for 75,000 and last year earned $300 million in valuable foreign currencies. Ironically, much of its economic benefit is wiped out by the sad state of Japan's own shipping lines. They are so short of ships of their own that they are unable to handle Japan's growing foreign trade. Japan must thus use foreign ships and pay out in shipping fees the foreign exchange that it earns by selling ships. Since the shipping lines' trouble stems chiefly from financial weakness, Prime Minister Ikeda is trying to strengthen them by encouraging mergers. Already two of Japan's largest lines have agreed to consolidate, and Ikeda hopes others will follow suit so that the lines will be able to buy more of the ships that Japan's shipyards are so busy turning out.

*Sweden is second with 14% of the market, followed by Britain (10%), Germany (8%), Italy (7%) and France (6%). The U.S. ranks ninth with 3.5%.

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