Chapter 771 - 353: Integration and Monopoly (2)

The small vessel market is fiercely competitive due to the large number of shipyards, with shipyards having to lower their prices to secure orders.

This has led to decreasing profits for small shipyards, potentially facing a future where income is less than expenses, causing widespread losses or even bankruptcy among them.

However, in terms of medium and large military ships, Spain’s shipbuilding industry is experiencing a situation where demand exceeds supply.

Besides the four major official shipyards focusing more on military vessels, Spain has a total of 43 shipyards employing over 500 workers.

Among these 43 shipyards, 32 can only build medium-sized ships of a thousand tons, unable to construct large ships of several thousand tons.

Only 11 shipyards are truly capable of building large ships, and the scale of these shipyards varies, with only a few able to simultaneously construct several large ships.

With Spain’s development of its African Colony, economic exchanges between the mainland and the colony have become increasingly frequent.

Every day, a large number of goods are transported from the mainland to Africa, and a large number of goods are brought back from Africa to the mainland.

The transport of these goods relies entirely on large cargo ships, which is also why the Spanish shipbuilding industry manifests a situation where demand exceeds supply for large ships.

Large ships in Spain are in such high demand that even transport companies founded by nobles and capitalists have to purchase large transport ships from abroad.

Besides economic exchanges between Spain’s mainland and colonies, Spain’s imports and exports also require a large number of cargo ships for support.

Given the shortage of medium and large shipyards, it is indeed necessary to consider merging some small shipyards to enhance Spain’s foundation and number of medium and large shipyards.

After listening to Minister Hoviar Soler’s report, Carlo nodded and inquired, "What thoughts does the Ministry of Industry have regarding our issues in the shipbuilding industry?"

Minister Hoviar nodded and replied, "Your Majesty, in my opinion, we don’t need so many small shipyards.

The construction cost for small shipyards is too low; with some funding, one can establish a rather sizable small shipyard. However, in terms of medium and large shipyards, even with adequate funding, it might not be feasible to establish one in a short duration.

Considering our increasing demand for large ships, I believe it is necessary to merge some small shipyards and raise our number of medium and large shipyards to over 50.

At the same time, the government should implement certain subsidy policies to help these medium and large shipyards stabilize their footing. Only when these shipyards have secured their position in both domestic and foreign markets can our shipbuilding industry compete with other European Countries.

Before reaching that point, the government needs to invest some funds and may even need to assist these shipyards in training a new batch of skilled shipbuilders."

The Spanish Government is no stranger to such methods.

More than a decade ago, Spain employed a similar approach in the military shipyard sector.

Originally, Spain had more than a dozen military shipyards, which were eventually consolidated into the current four major military shipyards.

The proposal by Minister Hoviar essentially emulates the integration experience in military shipyards to consolidate part of the civilian shipyards.

Small shipyards do not offer much enhancement to the nation, but medium and large shipyards provide a certain boost and have strategic value.

Civilian shipyards can completely convert to military shipyards during wartime, a transition much faster than building a military shipyard from scratch.

If Spain could develop dozens of medium and large shipyards, it would mean having dozens of military shipyards capable of constructing warships during wartime.

By then, the four major shipyards can fully focus on building battleships, while these converted military shipyards could construct cruisers of several thousand tons and other types of warships.

Carlo nodded but did not directly agree to Minister Hoviar’s proposal; instead, he looked towards Prime Minister Canovas and asked, "Prime Minister, what are your thoughts? Do others have any opinions?"

Prime Minister Canovas, at this point, was no longer the political novice who needed Duke Serrano’s backing to secure his position. Since officially becoming the Cabinet Prime Minister of Spain in 1877, Prime Minister Canovas had already been in the top leadership role of the Spanish Government for 13 years.

Being re-elected three times consecutively as the Cabinet Government’s Prime Minister, on one hand, demonstrated Carlo’s trust in Prime Minister Canovas, and on the other hand, it reflected Canovas’ capability and influence.

Currently, Prime Minister Canovas is undoubtedly the most influential figure in the Spanish political arena, his influence nearly matching that of the former Prime Minister Prim, although his control over the military is somewhat lacking.

Upon hearing Carlo’s inquiry, Prime Minister Canovas shook his head, smiled, and said, "I agree with Minister Hoviar’s proposal. For the issues already apparent in the shipbuilding industry, perhaps this is the best solution."

With Prime Minister Canovas having no objections, naturally, no one else would stand up to present their views.

After all, since neither Carlo nor Prime Minister Canovas expressed opposition, opposing at this time would be a blatant affront to the King and Prime Minister, wouldn’t it?

Seeing no dissenting attitudes, Carlo nodded and subsequently issued an order: "Since there are no objections, we will adopt the method proposed by Minister Hoviar.

The Ministry of Industry should promptly come up with a plan, and the subsidization involved for the shipyards can be resolved in consultation with the Finance Department.

Once a complete proposal is ready, you can self-approve it within the Cabinet."

From his twenty years of reigning as King, Carlo’s biggest takeaway is not to express too many opinions during Cabinet meetings.

As long as the King has no explicit stance, the ultimate responsibility has no relation to him. If the matter succeeds, credit will surely be given to Carlo.

Since this method has already been used once in the military shipyard sector, Carlo is unconcerned about such a plan failing.

Even if consolidating small shipyards leads to the creation of several powerful medium and large shipyards, these shipyards won’t achieve monopoly status.

Even if a monopoly is formed, it would certainly not affect Carlo’s power in Spain. The biggest difference between Spain and other European countries is that official enterprises, backed by the Royal Family and government, have become a behemoth among Spanish capital.

Coupled with the capital from nobility as a helper, it’s tough for any domestic or foreign capital to gain any governmental power in Spain.

This is the advantage of state capitalism: capital can indeed influence the government. But the largest capital is the Royal Family and government, ensuring that only the Royal Family can affect the government, while other capital pales in comparison to official capital.

Among Spain’s four major shipyards, the Royal Family holds a certain percentage of shares. The largest Royal Guanizuo Shipyard is fully owned by the Royal Family; it is a massive shipyard employing nearly 10,000 workers. How could other shipyards compete against this giant?

In the past two decades, the Royal Family’s capital has already infiltrated various industries within Spain. In some important sectors, such as heavy industry, the chemical industry, military industry, oil, and agriculture, Royal Family capital is present.

Even if several monopolistic enterprises united, they would still be no match for the current financial power of the Royal Family consortium.

Whether in terms of governmental influence or pure capital, there are very few capitals globally that can rival the Spanish Royal Family.