Overcapacity policy key to balanced shipbuilding industry

摘要

Shipbuilding is changing, it is not only becoming technologically more challenging, but the market in which ship operators compete is becoming more challenging and that means that fewer ships are being ordered. Following the financial crisis in 2007-8 demand for cargo ships declined dramatically, but new orders were still being delivered. This meant that freight capacity, the supply side of the equation, was growing rapidly, while consumer demand for goods such as consumer durables and oil and other things transported by sea diminished. The supply and demand balance in shipping was gone and as a result freight rates collapsed, which meant that owners were not able to make payments on new vessels as easily and in some cases at all.