Structural analysis of the shipbuilding industry based on transaction cost theory
by M. Guisado-Tato, M. Vila-Alonso, C. Ferro-Soto
International Journal of Services Technology and Management (IJSTM), Vol. 5, No. 4, 2004

Abstract: Due to the petroleum crisis in 1973, the demand of ships fell at a worldwide level, making it necessary to reduce the worldwide shipbuilding capacity. However, at that moment, the Korean shipbuilders' entrance in the international market increased even further the excess of supply, which had repercussions on the price of the ships and extended the crisis effects in the shipbuilding sector. European shipyards have suffered this situation in a special way: governments had to adopt measures that meant the closing of naval factories. The surviving European shipyards had to undertake important restructuring processes, based fundamentally on: (1) the externalisation of their value chain activities and (2) the subscription to cooperation agreements. In this study, we endeavour to identify the dimensions that determine whether different shipbuilding activities are carried out as market operations, within the hierarchy or through cooperation agreements. In order to achieve this goal, we have studied Spanish shipyards in the area of Vigo, since Spain, before the petroleum crisis, was the fourth most important worldwide shipbuilding country and Vigo was, and still is, the most important city for the sector in this country.

Online publication date: Wed, 07-Jul-2004

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