China Plans Merger of Shipbuilders to Create Behemoth

[Bussard Ramjet]

https://www.bloomberg.com/news/arti...lan-merger-of-shipbuilders-to-create-behemoth



Just why? Both CSSC and CSIC have been on a tear since their creation, and both are large enough to make anything.

Merging them will create a monopoly which will lead to lower competition and lower competitiveness.

It seems that China is forgetting all of the lessons that it learned and has applied successfully since the opening up period. One was to keep competition between state owned enterprises.

@Beast

 

[chengdusudise]

there is no monopoly because there are S.Koreans compete with us

 

[Bussard Ramjet]

there is no monopoly because there are S.Koreans compete with us

There is a monopoly over

1. Chinese home market
2. Chinese military shipbuilding
3. Chinese research and expenditure
4. Chinese shipbuilding

 

[GS Zhou]

Haha, there are many independent shipyards across the Indian coast line. So the intense competition in India must make the Indian shipbuilding industry highly competitive.
Congrats!

Opps. I forgot to mention the dominant market share captured by India in the global shipbuilding market.
Congrats x2!

https://maritimetechnology.nl/media/SEA-MM-REPORT-42-FINAL.pdf

 

[chengdusudise]

There is a monopoly over

1. Chinese home market
2. Chinese military shipbuilding
3. Chinese research and expenditure
4. Chinese shipbuilding

Shipbuilding industry has 2 very powerful competitors---S.Korea and Japan, it is a free competitive industry.
furthermore, even CSIC and CSSC are merged, there is fierce competition in the Group. just like SAC and CAC compete with each other although they belongs to same group AVIC

 

[Cybernetics]

Heavy competition is desirable in a passive environment. China is currently not in a passive environment, it is attempting a massive industry upgrade and restructuring in the shipbuilding sector. If there is a very clear direction and specific goals, heavy internal competition is not desirable, concentration and greater coordination is desirable.

The merger will lower internal competition to increase surplus in order to quickly complete the industrial upgrade and reform, which has clear and specific goals set. In the competitive international shipbuilding market, small players get crushed so they stick to niche products (and China has plenty of these small players). Once the firm dominates the market and completed its transition, it can be broken up again to provide internal competition.