STX may build in China

STX Shipbuilding of South Korea, is considering relocating one of its dockyards to China to expand its production capacity and improve on its productivity. The company is considering various options, including relocating its facilities to Jinhae, south of Seoul.

Korean shipbuilders are looking for ways to expand their production capacity and cut costs as high steel prices erode their profit margins despite receiving record orders for new ships. STX, with 1,500 employees and an order backlog of 102 vessels as at May, is looking for sites with cheaper land prices and wages to keep down its costs. The company, which is due to report its first-half results tomorrow, did not say where it will move to in China.