Mitsubishi Heavy Industries Ltd. said it will scale down its shipbuilding operations by withdrawing from the money-losing large passenger ship business.

The company said Tuesday it will concentrate on building small- and medium-size passenger vessels and passenger-cargo ferries, and is considering spinning off that business.

It said it is already in talks on an alliance in the field with Imabari Shipbuilding Co., Oshima Shipbuilding Co. and Namura Shipbuilding Co.

Mitsubishi Heavy said it plans to make a final decision on the possible alliance by the end of the fiscal year.

After its shipbuilding orders plummeted in the wake of the global economic meltdown that began in late 2008, Mitsubishi Heavy sought to boost revenues by taking orders for highly profitable large passenger ships, and in 2011 took orders to build two large passenger vessels for a total of ¥100 billion.

But by the end of last March, Mitsubishi Heavy had booked a special cumulative loss of over ¥230 billion on that deal.