Many people reckon that China is on its way to independently making an aircraft carrier. Some have even predicted a timetable for when such a carrier will be put into use. However, few have noticed that China's shipbuilding industry is undergoing a mounting challenge due to overcapacity of production. Many shipbuilding factories have shut down because they lack orders.

Against this backdrop, the Chinese Government has carried out a plan with the purpose of accelerating the restructuring of the industry and promoting the upgrade and transference of related companies. It aims to revitalize the industry within the next three years.

While decreasing overcapacity, the plan requires shipbuilding companies to enhance their technical level and build hi-tech vessels including ocean engineering ships, liquefied natural gas (LNG) carriers and so on. Also, it requires financial institutions to stop giving bank loans to projects establishing new shipbuilding factories.

Judging from the orders, unfilled orders and building quantities, China is now the world's biggest ship builder. It already possesses independent development ability in bulk cargo ships, tankers and container ships, which constitute the three major ship patterns. Also, breakthroughs have been made in hi-tech and highly value-added ships, as well as ocean engineering ships. Its building efficiency and quality management of large ships have also reached an advanced level in the world.

However, due to the negative fallout of the international financial crisis and the European debt crisis, the world's shipping industry and shipbuilding industry are sluggish. This has dealt a major blow to the Chinese shipbuilding industry and brought about a sharp decrease in the number of orders. In addition, overcapacity has become an issue in the past two years.

In the meantime, new regulations and standards are continually emerging in international shipping and shipbuilding. They have continually upgraded requirements for energy-saving, safety and environmental protection. The world shipbuilding industry is entering a new phase of profound adjustment, wherein all-around competition has become increasingly fierce.

It is thus urgent for the Chinese shipbuilding industry to accelerate its restructuring and charge forward in the new situation. Overcoming the difficulties and revitalizing the industry means that big changes will need to be made.