Description
The Dutch shipbuilding industry during the period 1914-1983 provides a good example of the rise and decline of an industry. The interwar period constituted a constant, though strongly alternating, rise in market share and production. During the initial postwar years, this trend continued while now adding increased profitability. However, after 1960, Dutch shipbuilding’s market share experienced a sudden drop, which was quite drastic compared to other important shipbuilding countries worldwide. This decline meant the end of major importance for the Netherlands in this industry.The period during which the significance of the Dutch shipbuilding industry manifested and declined can best be described as highly dynamic. The years between 1914 and 1945 were largely decided by war and crisis. These circumstances resulted in serious losses (WW II) and high profits during both world wars, in worldwide protectionist measures and high unemployment rates in the 1930s. The postwar period saw increasing international competition, including the rise of Japan as the leading shipbuilding nation. Also, various events, such as the Suez Canal closure of 1956 and the oil crisis of 1973, had serious consequences for the shipbuilding industry.
When concentrating on the Dutch shipbuilding industry, recently collected data points to a sharp break in the percentage of ship production orders by Dutch shipping companies within the total production of large Dutch shipbuilding companies. During the interwar years and early postwar years, shipbuilding companies generally received 60-75% of production orders from national shipping companies, while this number strongly decreased in the 1960s. This gives the serious impression that the shipyard-shipping linkage was strongly connected to the collapse of the Dutch shipbuilding industry’s market share and profitability in the early 1960s, indicating that Dutch shipyards were very dependent on orders from Dutch shipping companies. This is underlined by the fact that around the time when Dutch shipbuilding turned into decline, the Dutch shipping companies were in a very precarious situation as international competition threatened their position.
This paper, therefore, examines the aforementioned development of Dutch shipbuilding by focusing on the linkages between the Dutch shipbuilding industry and Dutch shipping companies. To what extent was the varying competitiveness of Dutch shipbuilding companies between 1914 and 1983 related to linkages with the national shipping companies, and what were the reasons for these linkages? The drastic change in market share seems too radical to be solely explained by more traditional factors of competitiveness, such as cost and quality aspects. With a focus on industry linkages, the paper wants to unravel the decision-making processes leading to company strategies aimed at other, perhaps even more creative, ways of gaining a competitive edge in the market than company innovation. It can thereby give insight into the question of whether the previous period of growth was due to a competitive production process or simply a result of beneficial relations with Dutch shipping companies.
To research the long-term development of shipyard-shipping linkages, this paper uses data on ship production by Dutch large shipyards from Lloyd’s Register of Shipping annual books between 1914 and 1983. It allows for matching the individual shipyard production with ships within the fleet of Dutch shipping companies to obtain insight into the degree to which Dutch shipbuilding companies were dependent on national orders. Furthermore, ship size and type have been incorporated to give weight to the linkage between the shipbuilder and shipping company. Second, company archives, including reports and correspondence, of the largest Dutch shipbuilding and shipping companies, provide information on the reasons for the allocation of orders for ship production. Moreover, reports from public and private maritime associations provide knowledge on the various occasions in which executives from both types of companies interacted.
In this way, the paper provides an alternative explanation for the rise and fall of Dutch shipbuilding and contributes to the debate on the sources of firm and industry competitiveness. Moreover, it illustrates the effect of internationalisation on the industry structure and on existing relations between the main economic actors.
| Period | 29 Aug 2019 |
|---|---|
| Event title | EBHA Congress |
| Event type | Other |
| Location | RotterdamShow on map |
| Degree of Recognition | International |
Research programs
- ESHCC HIS