Japan's third largest shipbuilder Mitsubishi Heavy Industries Ltd said that its annual costs at its marine unit will probably increase by as much as JPY 12 billion (USD 111 million) because of rising steel prices.
Mr Shiro Iijima managing executive officer in charge of the marine business without providing the percentage increase told analysts and reporters that Mitsubishi Heavy which uses 350,000 tonnes to 400,000 tonnes of steel a year may have to pay JPY 10.5 billion to JPY 12 billion more for steel. He said that “The rising cost of steel plates will have a big impact on the Japanese shipbuilding industry.”
He added that “Some shipyards are likely to go into the red.''
Mitsubishi Heavy is looking to take more orders for vessels, including cruise ships that use less steel, and expand repair works to help it weather higher steel costs.
