Hyundai Heavy speeds up business consolidation

Hyundai Heavy Industries Group, the country’s top shipbuilding conglomerate, is speeding up consolidation of the business management units of its three shipbuilding-related subsidiaries in an effort to streamline operations.

The group said Tuesday that Hyundai Heavy Industries, Hyundai Samho Heavy Industries and Hyundai Mipo Dockyard will come under a single management system for finance, accounting, information technology and public relations.

“We hope to lower the cost and burden of overlapping investments in the three subsidiaries,” the group said in an email statement.

Hyundai Heavy said it is also actively reviewing plans to integrate nonshipbuilding affiliates, including Hyundai Oilbank and Hyundai Corp.

The group has taken steps to integrate the three shipbuilding units since last year.

In October, Hyundai Heavy launched a joint service center and vessel business headquarters for the three subsidiaries. It also slashed 81 of the 262 executive positions at the three units as part of its reform drive.

One of the most notable moves was to unify onshore and offshore plant business units in January, an apparent measure to pull out from the money-losing onshore plant business.

Hyundai Heavy also launched a voluntary redundancy program targeting some 1,500 workers, the second of its kind since the company was established in 1972.

About 480 administrative workers who have more than 15 years of experience at the company were also advised to leave this month, local reports said.

According to company officials, Hyundai Heavy won orders worth $900 million in the first quarter of this year, less than one-quarter of the annual goal of $15 billion.

By Suk Gee-hyun (monicasuk@heraldcorp.com)