A year ago, Zhoushan Changhong International Shipbuilding Co., Ltd. received an order from a Hong Kong shipping company for the construction of two 250,000-ton bulk carriers from the domestic shipbuilding giant "Guangzhou Shipyard International," gaining a reputation in the industry. As a new factory taking on the largest tonnage bulk carrier in Zhejiang Province, it has drawn admiration, but more so, questions about the capabilities of this new factory against the backdrop of a challenging international shipping and shipbuilding market.

However, just a year later, with over 3 billion yuan in shipbuilding industrial output value, over 100 million yuan in ship repair industrial output value, and 11 foreign drilling platforms dismantled... "Changhong International" has let its products and strength speak for themselves, becoming a rising star in the industry!

Because it is new, "Changhong International" is energetic, bold, and driven; also because it is new, "Changhong International" is more low-key, pragmatic, and cautious.

Even in a poor shipbuilding market, there is a way to establish a foothold. "Changhong International" is market-oriented, actively exploring in marine engineering manufacturing, ship repair, ship dismantling, second-hand ship trading, and metal resource utilization, implementing a multi-faceted approach to build a complete industrial chain, attempting to thrive in the market with a "winner takes all" image.

Building the most precise ships

On the northwest coast of Xiaosha Street in Dinghai, Zhoushan Island, the deep-water coastline stretches for miles. Setting sail from here, one can soon enter the international golden waterway, where the "Changhong International" industrial park is located.

At around 9 a.m. on October 30, Zhoushan Changhong International's first 250,000-ton bulk carrier was named and launched. The ship is 327 meters long, 57 meters wide, 25.50 meters deep, and has a designed draft of 18.10 meters, making it the largest bulk carrier in Zhejiang Province to date.

From steel plates and individual parts... to a massive vessel sailing the seas, the repetitive shipbuilding process is nothing unusual in the eyes of Li Jijun, who has 30 years of shipbuilding experience, but this particular ship holds a special place in his heart.

"This is the largest bulk carrier ever built in Zhejiang, and it is also the most precise ship among the more than 300 ships I have built!" said Li Jijun, Executive Vice President of Changhong International Shipbuilding Co., Ltd., as he gazed at the nearly completed work outside the window, a smile breaking through his stern expression.

In the face of new circumstances, using internet thinking to reshape the shipbuilding ecosystem and change the shipbuilding industrial chain is a new challenge for the shipbuilding industry. In terms of equipment intelligence and management information, "Changhong International" has put these into practice and improved production efficiency through automation and mechanization, laying the foundation for digital shipbuilding.

"At the shipbuilding site of Changhong International, you won't see the traditional 'sea of people' in shipbuilding, but rather a large number of modernized equipment.

"In modern shipbuilding, the precision of a ship depends on the welding process, and the quality of the welding directly reflects the shipbuilding capability of the company. By replacing labor with machines, the company has sustainable development momentum, and shipbuilding efficiency has significantly improved," said Wang Jiazhen, head of the shipbuilding design department at "Changhong International." With over 85% of the welding being semi-automated and a strict inspection mechanism along with rigorous training for welders, the precision of this ship has been achieved.

It is reported that the world's most advanced transverse submerged arc automatic welding technology will soon be put into use. In addition, shipbuilding technologies such as magnetic tooling, automatic drawing devices for onboard adjustment pipe sampling, automated painting design, and hoisting simulation systems will also be gradually applied.

The shipbuilding industry's landscape is changing, and turbulence is inevitable. "Changhong International," which is eager to make a significant impact, does not want to hear the evaluation that 'this is after all a new factory,' but instead sets itself high standards as an industry leader, striving to turn 'impossible' into 'possible.'

The welding quality of this ship has received high praise from classification societies, shipowners, and Guangzhou Shipyard International. The commissioning party, Guangzhou Shipyard International, conducted RT (X-ray inspection) and UT (ultrasonic testing) inspections, achieving an over 85% one-time qualification rate for the welding inspection of 'Henghou No. 5.'

"Being able to withstand professional inspections from peers means the quality is solid!" Li Jijun is very satisfied with this result, which is free of embellishment, saying, "For the same type of ship, if others can build it, we must build it the best!"

Accurately positioning to seize opportunities

Engaging in manufacturing is a lonely commitment that requires a heart of contentment.

"Henghou No. 5" embodies the hard work of all "Changhong people" and is also the debut of "Changhong International" in the industry, directly determining the company's position in the industry and its market recognition.

Huang Yafeng, Vice President of Changhong International Industrial Park, believes that under the new normal, for the manufacturing industry to survive and develop, it must take the initiative in competition, and the only way to do this is to earnestly produce products and create brands; without a brand, everything is just fleeting.

In a sluggish industry, shipowners are picky. "Changhong International" won the olive branch of commissioning two 250,000-ton bulk carriers from the domestic shipbuilding leader "Guangzhou Shipyard International" as soon as it entered the market, attracting much attention from the industry.

From January to September this year, Changhong International Shipbuilding Co., Ltd. achieved an industrial output value of over 3 billion yuan, a 44% increase compared to the same period last year, repairing a total of 102 ships, including 80 foreign vessels and 22 domestic vessels, with an output value of 120 million yuan.

In 2014, "Changhong International" was first included in the Ministry of Industry and Information Technology's national shipbuilding industry 'white list' and Zhoushan's 'shipbuilding characteristic enterprises.'

"Changhong International" has an astonishing development speed, relying on extraordinary strength.

The shipbuilding industry is full of changes, presenting both challenges and opportunities. In practice, "Changhong International" continuously adjusts, optimizes, enhances, and matures, and is now capable of undertaking high value-added ship types.

Since the beginning of this year, there has been a resurgence in orders for ultra-large container ships, with more and more shipping companies entering the market for ordering ultra-large container ships.

As a newcomer in the shipbuilding industry, "Changhong International" has not rushed to compete for a homogeneous market with its peers but has focused more on its own development positioning and actual capabilities, with research, design, and manufacturing of high value-added ship types being its core competitiveness.

Based on the market development trend of the upcoming 'big ship race' and its own first-class domestic hardware facilities, "Changhong International" has set its sights on large container ships as its main ship type for the next few years.

Currently, "Changhong International" is in talks with a world-renowned container shipping company, hoping to leverage the shipping company's marketing to specialize in the container ships they need.

This anticipated collaboration may bring another surprise to the shipbuilding industry in Zhoushan.

Multi-core drive of the entire industry chain

Faced with a persistently sluggish shipping market, the shipbuilding industry is no longer thriving; perhaps finding direction is much more useful than waiting idly.

While working hard, 'Changhong International' does not forget to look up. This year, the ship repair industry has welcomed good opportunities. Considering that there is still room for shipbuilding, 'Changhong International' seizes the opportunity to develop ship repair business.

At most, 'Changhong International' had 11 ships docked at the same time for repair or awaiting repair. With shipbuilding not being fully utilized, ship repair comes to the rescue. The leftover scraps from shipbuilding are used for ship repair, extending the industrial chain, saving costs for the company, and bringing considerable profits.

With the advancement of the 'Belt and Road' initiative and the construction of the Zhoushan Jianghai Intermodal Service Center, the ship repair industry will bring more opportunities to 'Changhong International'.

The market is ever-changing. In recent years, many companies no longer aspire to be champions in niche industries as they did in the past; they are collectively pursuing a full industry chain business model.

In fact, leveraging the entire industry chain, 'Changhong International' is trying to enhance its control and voice in the industry chain. On the other hand, since the financial crisis, companies have placed more emphasis on cash flow, with investments tending towards high-profit areas, aiming to earn profits while preventing risks, which objectively leads companies to extend related industrial chains.

'Changhong International' is finding a way out in the market, actively constructing a new business model of 'multi-core drive', which is a breakthrough for shipbuilding companies to transform and upgrade during the industry's downturn.

Currently, 'Changhong International' is actively exploring areas such as marine engineering manufacturing, ship repair and construction, ship dismantling, second-hand ship trading, and metal resource utilization, implementing a multi-pronged approach to build a full industry chain. 'For us, developing ship repair, dismantling, and ship trading around the main shipbuilding business is not a distraction, but rather a boost to the development of the main business of shipbuilding. It is a parallel and complementary relationship that ultimately leads to a win-win result,' said Huang Yafeng.

The industrial chain is not that simple, but companies are not unaware of the significant challenges ahead. 'Changhong International' tries to utilize existing resources to expand related industries, maximizing resource utilization and reducing costs. 'Changhong International' is planning to build a ship trading center, which is different from traditional trading centers; it leverages the company's dismantling resources and combines the internet to develop a crowdfunding concept trading model. 'Changhong International' also intends to share in the development of offshore wind power, utilizing existing facilities and equipment to manufacture large offshore structures such as bridge steel box girders and offshore wind turbine foundations.

To establish its advantages in the fierce competition of survival of the fittest, it is necessary to integrate resources in the current survival model, increase added value as much as possible, and enhance competitiveness.

According to reports, 'Changhong International' will further enhance its competitive advantage in quality and brand, create a product structure that leads mainstream products and expands high-end products, promote equipment transformation and technological innovation, research modern shipbuilding technology, and develop new green and environmentally friendly ship types as well as high-tech, high-value-added ships. It will be market-oriented, introducing technology, capital, and management from advantageous domestic and foreign enterprises to participate in the development of shipbuilding enterprises. It will strengthen the construction of a multi-level talent team and enhance the training of specialized and international talents.

Green ship dismantling wins international recognition

To participate in international competition and win international markets, companies must grasp the initiative for development, which is also the direction for countless Chinese enterprises to strive for.

'Changhong International', which started with ship dismantling, operates with a global perspective and according to international rules, with 'environmental protection and safety' as its core competitiveness, standing out in the rapidly changing market competition.

In the two docks of 'Changhong International's' dismantling yard, there lies a white and green Dutch ro-ro ship and a large offshore platform. These two docks, with areas 10 times and 8 times that of a standard football field respectively, are currently the largest and most advanced ship dismantling docks in the country.

Some shipowners transport ships from Brazil to Zhoushan, with the shipping cost alone equating to the value of the old ship; nevertheless, the shipowners still insist on selling the ship to 'Changhong International'.

The reason foreign shipowners are willing to do business with 'Changhong International' even at a loss is the balance of trust and recognition of 'Changhong International's' green and environmentally friendly dismantling brand.

At the 'Changhong International' dismantling yard, the dismantling site is not as dark as imagined, because before the old ships enter the yard for dismantling, flammable and explosive substances such as residual oil, asbestos, lead from batteries, and sulfuric acid are thoroughly removed and collected for harmless disposal according to strict requirements. 'Changhong International's' dismantling process meets international industry standards.

To pursue a path of green development, these steps must be strictly implemented. Because of its commitment to green practices, 'Changhong International' has won numerous orders from international giants. World-renowned shipping companies, including the largest container shipping company Maersk, have cooperative relationships with 'Changhong International'.

Currently, with scrap steel prices weakly declining, many dismantling companies are struggling on the cost line, but 'Changhong International's' dismantling business remains strong.

At present, 'Changhong International' is focusing on dismantling oil drilling platforms with higher added value. It has undertaken dismantling projects for 11 foreign drilling platforms, drilling ships, and 9 domestic vessels, having dismantled over 210,000 light tons.

According to reports, the international first-generation drilling platforms being dismantled contain more non-ferrous metals and have higher added value. The cranes, gaskets, and other mechanical equipment and components removed are all top international products at the time, which have reuse value in current marine engineering repairs.

Marine repair companies from the United States, Singapore, and other places have even come to contact 'Changhong International' for the dismantled 'treasures'.

Green ship dismantling is a sunrise industry for resource recycling, aligning with the national advocacy for circular economy development. Previously, the emphasis was on quantity expansion; focusing on quality improvement will be 'Changhong International's' future direction.

                                                        Excerpted from Zhoushan Daily