The ¥15 billion mammoth dock at Sakai — and the retreat of shipbuilding from Sakurajima (1964)

Not the bet on size, but the folding up of Sakurajima

The core of this investment was not the ¥15 billion committed but the closing of the slipways at the company’s birthplace. The Sakurajima works had been placed at the mouth of the Aji River in 1899 and, together with Innoshima, formed the base of what people called one of Japan’s three great shipyards. The slogan “all our strength to Sakai” was also a declaration that shipbuilding was being pulled out of there. Read together with President Nagata Keisei’s statement that the firm would concentrate on very large ships so as not to be confined within the scale of a mid-sized business, Sakai was a choice that left no line of retreat.

That choice was not, however, rewarded for long. Nagata himself spoke in 1969 of the limits of ever-larger hulls and of concentrating investment in the land-based divisions, and yet the company went on to build the Ariake yard, capable of handling 500,000-deadweight-tonne ships, for ¥42 billion. The reading that had worked at Sakai — that the side which owns the plant is the strong one — inverts the moment demand itself disappears, as it did with the yen revaluation and the oil crisis. The wisdom of capital spending, one might say, is graded not in the year it is made but in the year the demand goes away.