The technology group Wärtsilä launches the Wärtsilä 31SG pure gas engine for marine market applications. It is based on the successful Wärtsilä 31 product platform. The diesel version of the engine has been recognised by Guinness World Records as being the world’s most efficient 4-stroke diesel engine. The Wärtsilä 31SG engine further reduces the total cost of ownership and the environmental footprint for vessels operating in regions where there is a developed gas infrastructure. The commercial launch of the Wärtsilä 31SG takes place in September at the Gastech 2019 conference and exhibition being held in Houston, Texas, as well as at the Neva St. Petersburg exhibition and maritime forum in St.Petersburg, Russia.
The integration layout for hybrid installations featuring the Wärtsilä 31SG engine.
Following Wärtsilä’s introduction of dual-fuel engine technology in the 1990s, LNG has become established as a viable and attractive marine fuel. This has led to the rapid expansion of the global LNG bunkering infrastructure, which sets the stage for the next evolutionary step, namely a larger scale application of pure gas engines within the marine and offshore industries.
“The highly efficient Wärtsilä 31SG moves the industry forward by providing owners and operators with a practical means for lowering costs and enhancing environmental sustainability. The gas-only focus and lean-burn spark ignition technology allows for further optimisation of thermal efficiency, while lowering greenhouse gas emissions and facilitating adaptations for alternative heavier gas fuels, such as LPG,” says Rasmus Teir, Product Manager, Wärtsilä Marine.
Wärtsilä has an extensive track record with SG lean-burn technology, with more than 1800 engines delivered and 37 million running hours accumulated in demanding land-based energy market applications. The Wärtsilä 31SG was introduced to the energy market in 2017, and now builds on this pedigree to offer reliable pure gas solutions with low lifecycle costs also for marine customers.
The increasing adoption of hybrid propulsion offers additional opportunities for pure gas engines. The Wärtsilä 31SG is ideally suited for hybrid applications, since it provides outstanding thermal efficiency while also providing investment cost reductions that help offset the additional cost of energy storage. Pairing the Wärtsilä 31SG with battery packs furthermore enables designing for redundancy, while securing the highest total system efficiency.
Thursday 27 June, 2019, saw distinguished political and industry kingpins congregate at the Hilton Helsinki Kalastajatorppa in Finland for an afternoon of closed-door talks at what was the first SEA20 High-Level Meeting.
SEA20 is a not-for-profit initiative aimed at bringing together a selected group of representatives from the world’s most influential port cities to plan the future of urban living and the role of shipping within that. Participants at the event included Jan Vapaavuori, Mayor, City of Helsinki; Alexander Stubb, Former Finnish PM and now Vice-President, European Investment Bank; Jaakko Eskola, President and CEO, Wärtsilä; Joshua Berger, Director of Maritime, State of Washington and many more revered guests from China, Europe and the US.
The aim of the meeting: to find common solutions for building a globally efficient, ecologically sound and digitally connected future maritime sector. Why? According to the United Nation’s latest estimate, 68% of the global population will live in cities by the year 2050. This shift places pressure on the development of city infrastructure and the maritime sector. While shipping is by far the most cost-effective way to move goods and people around the world, as consumer demand increases maritime businesses are increasingly faced with major challenges in transitioning to greener, more sustainable operations.
“According to the International Maritime Organization (IMO), 90% of global goods are transported by sea meaning that globalisation, urbanisation and the development of maritime logistics are all deeply interconnected. When working on several pilot projects related to, for example, renewable fuels and the digitalisation of the maritime industry, we have noticed a general reluctance to adopt new solutions on a broader global level. We believe that this stems from a lack of market incentives and supportive legislation. The entire industry should be further encouraged to be more transparent and cooperate more broadly. When we all work together we can build a stronger marine ecosystem,” says President and CEO of Wärtsilä, Jaakko Eskola.
Marine cities are becoming the drivers of global development
The event included a discussion on the preliminary findings of the “Maritime Future: A Global Analysis on Marine and the Environment” – a report compiled by the think tank Nordic West Office with contributions from global experts in maritime and city planning. The full report, to be published later this year, aims to map the answers to several bottlenecks related to the development of the maritime industry.
”The need to create a smarter marine and energy ecosystem that can handle change in the coming decades is of paramount importance for our marine cities. Today, shipping lacks the comprehensive sharing of data and mutual trust necessary for solving sustainability issues. The issue of the common fate of cities and ports should be raised. Ports and their surrounding areas, at sea and on land, are in need of innovations and their creators,” says Lauri Tähtinen, the Nordic West Office Research Director responsible for conducting the report.
Participants at the event debated the themes of the report and its preliminary findings. There was general consensus that cities are fast becoming the drivers of global development in a world that needs to find greener and more sustainable solutions. Pollution, greenhouse gas emissions and increasing congestion are contributing to social tension in cities. The maritime sector has a significant role to play in abating these issues if only the doors would be further opened to encourage a better relationship between the key stakeholders. It was raised that guidelines for a smarter maritime ecosystem are needed and the foundation of new 2020 principles was proposed to provide a framework for this.
”There is a need for cooperation. For example, the port of Helsinki and the city of Helsinki are jointly developing port-city ecosystem by enhancing operational efficiency, digitalisation and sustainability through innovation and experiments. We see SEA20 as a great way of sharing these kinds of experiments with other cities and tackling challenges together,” says Ulla Tapaninen. Head of Unit, Enterprise Services, at the City of Helsinki.
Bore has signed a new-building contract with Wuhu Shipyard Co.Ltd in China for three (3) new LNG-powered RoLo vessels to be built during 2020-2021. Thereby, Bore’s operated fleet will grow to 11 vessels. The new state-of-the-art RoLo vessels will serve under a long-term charter agreement with UPM.
Together, showing the power of being Your Partner in Shipping, Bore and UPM have designed the concept for the RoLo vessels to be built by Bore for sustainable sea transportation of UPM’s paper products in Europe, combining best features from pure RoRo (Roll-on Roll-off) with LoLo (Lift-on Lift-off) transportation concepts.
The new design of the RoLo vessels will meet the flexible cargo transportation requirements of forest products in different forms. Also, these vessels can take RoRo cargo, be suitable for container transport, be loaded with both high & heavy as well as project cargo thanks to excellent deck strength, but also bulk cargo can be transported using a hydraulic bulk head.
The vessel main particulars are; length 120 m, width 21m, DWT 7,000 and a speed of about 15 knots for suitable and economical transport solutions in the trade. They will have ice-class Swedish/Finnish 1A, and will meet the latest technological, operational and environmental standards.
As a next step in Bore’s environmental agenda, these vessels will represent further steps into cleaner emission with dual fuel engines installed, mainly to be operated on LNG fuel. This means, that the vessels will be fueled by liquid natural gas (LNG) which results in a significant (approximately 25%) reduction of CO2 emissions compared with commonly used marine gas oil. In addition NOx and SOx emissions will decrease with over about 85 % and 99%, respectively. At the same time the emission of particulate matter (soot) will decrease with 99%.
Håkan Modig, Bore CEO announces; ”We are pleased that Bore and UPM has agreed on designing and building three RoLo vessels for delivery in 2021 and 2022. For Bore this charter agreement is a major milestone. Together with our customer, the vessels are designed to take our environmental thinking one step further by introducing the LNG engines into our fleet. Also, the special requirements from our customer for their paper product trade have been a driver for the concept. This way of working represents our way of thinking as Your Partner in Shipping.”
Lauri Rikala, Director Break Bulk Shipping UPM Logistics, affirms; “UPM decided to enter into this partnership with Bore based on the good business and technical knowledge and approach towards innovative and sustainable shipping solutions that Bore has shown. This arrangement is a consistent step in UPM’s logistics strategy and will safeguard sustainable, reliable and tailor made shipping solution on long term.”
Port of Helsinki and Elisa signed a letter of intent this month for making 5G technology available to ship passengers in Helsinki’s West Harbour.
The aim is to make a commercial 5G network available in the interior facilities of West Terminal 2 and the outdoor areas of West Harbour during autumn 2019. At the same time, the companies are in the process of developing a suitable operating model for building indoor 5G coverage in Helsinki’s other passenger terminals.
– The purpose of this cooperation is to improve passengers’ mobile connections, particularly in terminals. This is a major stepping stone for us in the more widespread adoption of 5G technology at the Port’s terminals, states CEO at Port of Helsinki Ville Haapasaari.
– The development of 5G services and the building of the network for various needs is immensely fascinating. Helsinki’s West Terminal serves millions of passengers a year, and waiting for your ship to depart is more fun if you can watch TV shows or play games to pass the time. 5G guarantees lightning fast connections for these types of needs, says Director, Mobile Solutions Eetu Prieur from Elisa.
New services based on passenger feedback
– We will be working together with the Port of Helsinki to find out what kind of services made possible by this new technology would be of interest to the ship passengers visiting the terminal and how customer-specific private networks could be utilised for the Port of Helsinki’s own applications, Prieur continues.
5G is the next generation of mobile networking and up to ten times faster than 4G. Devices utilising the 5G network offer numerous benefits to users, such as being able to play and download videos, games, movies and large files faster than ever. With the development of new services, 5G may very well revolutionise the way we use and utilise mobile networks and devices. 5G will also facilitate and enable increased automation, robotisation and the use of remote-controlled devices. In addition to all this, 5G will enable the setting up of company-specific, tailored network solutions, i.e. private networks, and expand the Internet of Things to new places.
Helsinki’s West Harbour is Finland’s busiest passenger harbour with over 7 million annual passengers. It is used primarily for fast liner traffic to Estonia, serving passengers, passenger car traffic and goods traffic. The West Harbour also has a regular connection to St Petersburg.
The Port of Helsinki is Finland’s leading general port for foreign trade as well as the busiest passenger port in Europe. The Port of Helsinki serves the business world and well-being of the Helsinki region and the whole country and has significant positive effects related to the economy and employment. In 2018, a total of 12.1 million passengers passed through the Port of Helsinki and 14.7 million tonnes of goods were transported via the Port. The turnover of Port of Helsinki Ltd was 97 million euros. www.portofhelsinki.fi/en
Elisa is a pioneer in telecommunications and digital services. We serve approximately 2.8 million consumer, corporate and public administration organisation customers, and have over 6.2 million subscriptions in our extensive network. Cooperation with Vodafone and Telenor, among others, enables globally competitive services. Our core markets are Finland and Estonia, and we also provide digital services for international markets. Elisa’s shares are listed on the Nasdaq Helsinki. In 2018, our revenue was EUR 1.83 billion euros, and we employed 4,800 people. As a responsible Finnish market leader, our operations are guided by continuous improvement. Further information on www.elisa.com, Facebook (@elisasuomi) and Twitter (@ElisaOyj)
More information:
CEO Ville Haapasaari, Port of Helsinki ville.haapasaari(at)portofhelsinki.fi tel. +358 (0)40 709 8798
ABB enters new market segment with order to install Azipod® electric propulsion on board two dry bulk carriers from Germany’s largest bulk carrier company Oldendorff Carriers.
Two self-unloading dry cargo transshipment units will be the first bulk carriers in the industry to feature ABB’s Azipod® electric propulsion. Both vessels, due for delivery to Oldendorff Carriers in 2021 from the Chengxi Shipyard in China, will be equipped with a complete power and propulsion solution from ABB.
Each 21,500 DWT vessel will feature two 1.9MW Azipod® units. ABB will also supply a wide range of electric, digital and connected solutions, including main diesel-electric power plant, generators, bow thruster motors, transformers, switchboards and the power management system for propulsion and cargo handling.
“The choice of Azipod® electric propulsion system has reduced the investment costs dramatically as the vessels are already equipped with high power generation required for self-unloading/loading cargo handling,” says Jan Henneberg, Newbuilding Manager, Oldendorff Carriers. “These shuttle vessels must perform reliably over an extended period at maximum efficiency, and need to be especially maneuverable in shallow waters.”
Controlling a fleet of around 700 ships, Oldendorff Carriers is Germany’s largest operator of bulk carriers. Around 95% of Oldendorff’s owned fleet is comprised of ‘eco’ newbuilds delivered since 2014, which are specifically designed for low fuel consumption and reduced carbon footprint.
“This is a significant breakthrough for Azipod® propulsion, reaching a ship type that some suggested would always remain closed to podded propulsion,” says Juha Koskela, Managing Director, ABB Marine & Ports. “We are especially pleased to add Oldendorff Carriers as an Azipod® propulsion reference, considering its reputation for building and operating high quality, reliable and environmentally-friendly ships.”
The newbuild vessels are developed by Shanghai-based CS Marine design company together with Oldendorff Carriers. The self-loading vessels will be able to unload cargo utilizing a built-in conveyor system and without the need for assistance from shoreside equipment or personnel. Oldendorff Carriers will deploy the vessels for transshipment operations – transfer of cargo offshore from oceangoing vessels before delivery to the final destination.
Once in operation, the vessels will be among over 1,000 ships connected to ABB Ability™ Collaborative Operation Centers worldwide from where ABB experts monitor operational shipboard systems and offer 24/7 remote support. The vessels will leverage the ABB Ability™ Remote Diagnostic System, which deploys sensor-driven onboard monitoring software that fully integrates with analytics ashore.
Today, the global bulk carrier fleet comprises over 11,000 vessels, and, according to shipping association BIMCO, is projected to grow by 3.1% in 2019. The association estimates a total of over 400 newbuild bulk carriers scheduled to be delivered for launch this year. Global seaborne dry bulk trade is projected to reach 5.3 billion tons in 2019, according to shipping intelligence provider Clarksons Research.
The Azipod® propulsion system, where the electric drive motor is in a submerged pod outside the ship hull, can rotate 360 degrees to increase maneuverability and operating efficiency, as well as maximize cargo space on board. Over the course of close to three decades, ABB has supplied Azipod® units for about 25 vessel types, with the propulsion system accumulating more than 15 million running hours in total.
ABB (ABBN: SIX Swiss Ex) is a pioneering technology leader with a comprehensive offering for digital industries. With a history of innovation spanning more than 130 years, ABB is today a leader in digital industries with four customer-focused, globally leading businesses: Electrification, Industrial Automation, Motion, and Robotics & Discrete Automation, supported by its common ABB Ability™ digital platform. ABB’s market‑leading Power Grids business will be divested to Hitachi in 2020. ABB operates in more than 100 countries with about 147,000 employees.
The world’s first self-propelled detachable bow, which was conceived by the Finnish Transport Infrastructure Agency (FTIA), was launched in Naantali on Wednesday 28 August 2019. After a test period, the detachable bow will be deployed in the Saimaa area next winter.
WINMOS II (Winter Navigation Motorways of the Sea II) is an EU CEF-funded project for the development of winter navigation. The project’s objective is to develop and improve winter navigation and its safety and to secure sufficient icebreaking resources in the future.
One of WINMOS II’s sub-projects focuses on the development and construction of a motorised detachable icebreaking bow to be used in the Saimaa area. The detachable bow equipped with propulsion machinery is mounted to the tugboat by three-point fixing. The detachable bow has two straight axle lines driven by electric motors. The dimensions of the vessel and bow combination were designed so as to enable effective icebreaking operation in the Saimaa area and the Saimaa Canal.
The detachable bow was launched at Turku Repair Yard Ltd in Naantali on Wednesday 28 August 2019. After launching the detachable bow, its outfitting is continued, and the required pusher tug modifications are implemented. The tug and the bow are then fitted together for sea trials. The vessel will be available for FTIA’s tests in October, and it will be used for icebreaking operations in the coming winter.
The pusher tug Calypso, which is owned by Alfons Håkans AS, will be used for operating the detachable bow, and the tug will undergo modifications that enable the attachment of the bow.
Icebreaking service refers to assisting and towing vessels in icy conditions, safeguarding the safety of waterway transport and providing the related traffic control. FTIA is responsible for the public office duties and procurement associated with winter navigation as well as for the national coordination, development and control operations.
Watch the illustrative video about the detachable bow:
As one of the first EU countries, Finland has signed the High Ambition Declaration on Shipping. Finland, France and other signatory states stress the need of finding efficient measures to reduce greenhouse gas emissions in the shipping sector before 2023 and of ensuring that the emissions start declining as soon as possible.
The Declaration discussed at the G7 Meeting in Biarritz, France, on 26 August 2019 calls upon the states to maintain their emission reduction targets agreed earlier. The purpose is to ensure the commitment to the greenhouse gas emissions strategy of the International Maritime Organisation, IMO, so that states will maintain the agreed goals and schedule.
The name of the Declaration, “Niulakita”, originates in the highest peak of Tuvalu in the Pacific Ocean. The countries in the Pacific are not only dependent on maritime connections but also the first ones to suffer from climate change.
“We want the IMO member states to work for the common goals in reducing emissions in shipping and we want to proceed in the negotiations. In many EU countries, including Finland, innovations are constantly generated to reduce emissions in shipping and reduce the use of fossil fuels. Finland wants to encourage other countries and can help find efficient ways to swiftly reduce emissions in international shipping,” says Minister of Transport and Communications Sanna Marin.
The Declaration calls upon the states to commit themselves to achieving the goals of the greenhouse gas strategy in international shipping. According to the strategy, the amount of greenhouse gas emissions in the shipping industry must be turned into decline as soon as possible. CO2 emissions will be reduced by at least 40% by 2030, and at least 70% by 2050 compared to 2008.
Decisions on reducing emissions from global shipping will be made in the IMO Marine Environment Protection Committee. Shipping accounts for approximately 2.5% of global greenhouse gas emissions. Without efficient measures, the greenhouse gas emissions are expected to grow by 50–250% in the coming decades as maritime transport volumes increase. In spring 2018, IMO adopted an initial strategy on the reduction of greenhouse gas emissions from ships.
What next?
The Declaration is a message from Finland and other signatory states to the UN Climate Action Summit in September. Special Envoy for the 2019 Climate Summit Luis Alfonso de Alba has especially highlighted the importance of international shipping as a leader in climate action.
The aim of the Declaration is to strengthen the commitment to the agreed goals and speed up the negotiations in the IMO, which is a UN organisation. The next time the emissions reduction measures in the shipping sector are discussed will be in a meeting of the greenhouse gas working group of the IMO Marine Environment Protection Committee in London in November. Finland is currently holding the Presidency of the Council of the European Union and will coordinate the Union’s positions for the meeting. On Finland’s initiative, the climate impact of shipping and other transport modes will also be discussed in the EU Transport Council on 20 September.
Inquiries:
Pirita Ruokonen, Special Adviser to the Minister, tel. +358 50 911 3099 Päivi Antikainen, Director of Climate and Environment Unit, tel. +358 50 382 7101 Eero Hokkanen, Senior Specialist, tel. +358 50 476 0401Links to other web sites:
One Sea is seeking to create the world’s most advanced and competitive ecosystem in the field of autonomous maritime transport in Finland.
The new ecosystem will carry over some of the aspects of the present maritime ecosystem but, in large part, it will be completely new. The ecosystem will create an entirely new global business in Finland alongside existing successful businesses.
The ecosystem began operating in September 2016 under the management of DIMECC. One Sea brought together global pioneers and agile ICT companies to develop the world’s first unmanned maritime transport solution. Business Finland has committed to financing the autonomous maritime transport ecosystem and promoting the launch of new innovations until the end of 2021.
The ecosystem has created a roadmap for making autonomous and unmanned maritime transport a reality, and the goal of the project is to monitor progress towards this. The objective is to create the world’s first unmanned maritime products, services and functional ecosystem by 2025. The ecosystem is currently focusing on creating common industrial standards and contributing to international rules.
The partners in the ecosystem are leading companies in their fields, including ABB, Cargotec, Ericsson, Finnpilot Pilotage, Rolls Royce, Tieto and Wärtsilä. The ecosystem also has partnership agreements with the Finnish Marine Industries association, the Finnish Shipowners’ Association, the Finnish Port Association and Shipbrokers Finland.
The Meyer family-owned company Meyer Werft of Germany has been in the shipbuilding business since 1795. During the last several decades its emphasis has shifted to passenger vessels. Today, Meyer is one of the world leaders in producing specialized cruise ships.
Meyer operates today two yards in Germany: the main yard in Papenburg and a smaller yard in Warnemunde, the latter for the construction of smaller vessels and large floating sections for the Group’s other yards.
In 2014 Meyer took a big step of expansion by the acquisition of the biggest yard in Finland, the Turku yard – another specialist yard for cruise vessels.
The four Managing Directors of the Meyer shipbuilding group, Thomas Weigend, Dr. Jan Meyer, Bernard Meyer and Tim Meyer.
Meyer Group with its three yards is going through a major capacity expansion. What are the key figures of the group after say 3 years?
The biggest capacity increase will take place in Finland where we delivered one mid-size cruise ship per year when we took over the yard. By 2020 Meyer Turku will be able to produce two large cruise ships a year. In Papenburg we are reaching already this year our expansion target by building two big cruise ships a year and one small size cruise ship. Our shipyard in Warnemünde, Neptun Werft, is supporting Papenburg and Turku with floating engine room units and they have been growing recently to supply the demand of engine room units for Papenburg and will further grow for the increasing demand of engine room units in Turku. Currently the whole Meyer group is employing about 7600 employees and will grow to 8500 by 2022. We will then be able to deliver from Papenburg about 400,000 gross tons and Turku about 400,000 gross tons each year.
Mr Bernard Meyer.
The order book covers today exclusively cruise vessels. Will that be the name of the game also for the foreseeable future of Meyer group?
Definitely our core business is building cruise vessels. Besides that in the last two years we delivered as well a small coastal ferry, a big innovative RoPax ferry and innovative an LNG tanker.
The cruise shipbuilding market has really exploded during the last four years. Does Meyer see that as a sustainable development that would continue and even intensify?
Shipbuilding was, is and will be in the future a cyclical business and the current order volume is also a result of the low order book after the Lehman crisis So it is a natural phenomenon that after years of low order income there are also a couple of years with high order income. This is one reason is that cruising really fits the current consumer market as cruising is a very comfortable nice and relaxing way of travelling and seeing different destinations in one holiday. It is and will be also in the future successful as it offers very high value for money due to the very efficient business model of the ship owners. And one major difference to other shipping markets is that the building capacity is limited. That secures that there is no over-supply of cruise vessels in a short time as we have seen in other markets like in the container or tanker market some years ago.
One would think that the overall business environment must today be exceptionally good with a never-seen workload and the improved prices resulting from the huge demand. Do you foresee any dark clouds for years to come? What are potential risks in the market, if any?
Yes, the good news is: We are not short of orders and we are in good market conditions at the moment with improved prices but also with much higher costs. Especially the supplier market is over-heated and price level is not where it should be. Ship owners are not forced to place new orders. As soon as the price level is getting too high they can also easily wait with new orders. Therefore it is really essential to us and the whole shipbuilding cluster that we stay price-competitive. There are definitely big clouds coming up as we see in Europe many new small shipyards building now smaller cruise ships as well and first contracts and a clear strategic goal of Chinese government supported shipyards to enter the cruise shipbuilding market.
Another risk definitely is governmental intervention.
The capacity for cruise ships which is built up in China is completely out of balance to the demand and will destroy the market not only for shipyards that suddenly have too much building capacity and not enough orders but also in good years there is a high chance that too many cruise ships will be built and enter the market and by that ship owners will finally also be faced much more with the cyclical market. Up to now the limited building capacity for cruise ships was also very beneficial to the ship owners because the cruise market was by that growing maximum with 5-7% per year and therefore the ship owners were also able to do long-term planning because they were assured that not too much capacity will enter the market. Another risk definitely is governmental intervention. Most of our competitors in Europe are either partially or fully government controlled and supported and definitely the new competitors in China are heavily supported by their government while we are a family business and purely rely on our tradition, experience and the strong ability to innovate, be agile and have a long-term business target to develop the company to secure it for the next generations.
Three yards of the Meyer shipbuilding group: Papenburg/Germany, Turku/Finland and Warnemunde/Germany the last one for delivery of smaller vessels and floating ”engine room units” for the other two big yards.
It seems that Meyer very much concentrates on large cruise vessels while the small cruise vessel market also is extremely active. Why is that? Why not also small vessels?
Our current order book goes from river cruise vessels with 3,000 gross tons, small cruise vessels with 50,000 gross tons via mid-sized cruise vessels with 110,000 gross tons up to big cruise vessels with 180,000 gross tons and more. So we have a big variety in our order book. Neptun Werft in Warnemünde is specialist for cruise vessels up to 15,000 gross tons. Meyer Werft covers the spectrum from 20,000 to 180,000 gross tons and Meyer Turku from 100,000 gross tons onwards. We are very happy with our current order book of all sizes of cruise vessels, even though we are not active in the expedition market at the moment. However, this market is extremely cyclical. There were more or less no orders for more than 20 years and suddenly there is a huge order book and many small cruise vessels will come into the market in the next years and the market will be saturated for a while.
Meyer acquired the Turku yard about 4.5 years ago. Was the cruise market explosion already seen at that time or was that a positive surprise to Meyer?
At the time of the acquisition it was not foreseeable that the cruise market would develop so positively. Sometimes we simply need to be at the right time at the right place.
What were the main reasons for the acquisition in Finland? Why to Finland?
Since I started my career in 1973 at Meyer Werft we were always competing with the Turku shipyard first in ferries and gas tankers and later on many, many years in cruise ships. The shipyard in Turku was always our hardest competitor because like we they have been always very innovative, very hard working people and delivering good quality in time – all the attributes which are also very important for us. It is not only important that we could grow with the acquisition of the new shipyard, very important for me was also that their DNA is very close to our DNA.
Acquisition in another country often includes a lot of business risks. How after almost five years has the case been with the Turku yard?
We had a good start as at the beginning the Finnish government had a stake as well in the shipyard. They helped us to understand Finnish business practices. On the other hand, as the culture between Finland and Germany is not too different, we had a good start and we are now very happy that we did this decision.
MS Aida Nova, delivered from Papenburg to Aida Cruises in the fall of 2018. The first ever cruise vessel using LNG as primary fuel.
Obviously the operational integration between the yards in Germany and Finland is a must down the road for maximizing efficiency. How is that process developing?
Operational integration comes not from one year to the other, specially if we are building such highly complex products like cruise ships. However, the best visible example of the integration is the floating engine room unit which arrived here in Turku from Neptun Werft in Warnemünde last year as well as all the nine ships which have been ordered by the Carnival group – three AIDA ships and two P&O ships in Germany and two Costa and two Carnival ships for Turku – and which are designed on a common platform being the first fully LNG driven cruise ship platform in the world which was jointly developed by Papenburg and Turku design teams, and all the engine rooms being built at Neptun Werft. This integration process is developing very well and will continue.
There have been quite big differences between the operational procedures and practices in Germany and Finland as the facilities are quite different. Harmonization is an obvious target. How is that process developing?
The most visible difference between both yards is that we are building the ships in Papenburg in a covered building dock and the ships in Turku in an open building dock and that the integration of the subcontractors is slightly different. However, there are also many areas where we had and have a similar approach like high amount of modularization, high focus on process efficiency, high focus on quality and in-time delivery not only for the whole ship but also for the intermediate processes. Due to many changes in ownership in Turku in the past there was a huge backlog of investments that we are catching up now. So Turku will get for example latest laser welding technology installed at the moment with all the learning and improvements from twenty years of laser welding experience in Papenburg compared to new and innovative ideas from the production team in Finland.
Are there differences between Germany and Finland in the state support role and the attitude of the states to shipbuilding industry? What are they? Any improvements desired?
Germany and Finland act very similar. They are both supportive of the industry and both have more the Northern European attitude of following international rules and regulations extremely strictly with tight interpretations compared to the one or the other South European country which is stretching the rules. Therefore Germany and Finland are playing on the same equal field. Major difference between Germany and Finland is that due to the size of the country and economy the role of shipbuilding in Germany is insignificant and in Finland it plays an important role.
Cruise ship construction requires very specific skills. In today’s labor market this must be a major challenge. How does it look for years to come? Any differences between Germany and Finland in this area?
Yes, it is right, construction of cruise ships requires very specific skills. We require workforces in all sectors and that is also the big beauty of shipbuilding that each and every skill and task is needed to engineer, design, build and test such complex products, and you easily can see that on our homepage while screening open positions that the labor market in Germany is at the moment much tighter due to the much lower unemployment rate but due to our attractive conditions giving a long-term perspective we are also an attractive employee and therefore we continue to find the right persons. There are not many businesses where you are producing such interesting products and having such a long-term view of contracts up to 2020.
We in Finland are very proud of our innovative activities and track record in cruise shipbuilding segment. How do you assess the contributions by Finns in the past and potentially in the future?
The Finns have shown in the past that they are extremely innovative and we are 100% sure that they will be very innovative in the future too. Finnish education is top in the world and together with good and strong universities this is the basis for not only our but also Finland’s success. Our task is to give our employees also the right platform to innovate and we are showing that with each and every ship delivery. Right now we have many innovations under development, which you will see afloat in a few years and we will show and talk about them when they are ready to present.
Ships based on one and the same technical platform are being built nowadays in Germany and Finland for a total of four Carnival brands. What are the experiences of this kind of rationalization?
Of course it helps to generate a good purchase power. However, the biggest effect will be later on for the ship owner as he saves a lot of costs with a harmonized fleet in spare parts but also in crew training.
Meyer and Fincantieri with STX France under the acquisition process together cover today about 90% of all cruise ship new building volume. How likely is that the duopoly also will continue in the future?
We definitely see other shipyards in the future there as well, starting from MV Werften in Germany but also especially Chinese gonvernment-owned shipyards will have share in the future.
Differences between Fincantieri and Meyer? Meyer is a private group, Fincantieri is majority owned by the Italian state. Is this difference an element in competition? Is there a real level playing field with European yards?
We should not touch about others. We definitely know that we as a privately owned company have to solve our problems by ourselves. This was our strength in the past and will be our strength in the future.
The entrance of Asian yards to cruise-ship construction has been discussed for the last twenty years. Japan seems to be out and so is South Korea. But China is becoming an issue. How do you see the potential role of Chinese yards in the future and when?
The difference between South Korea and Japan trying to enter the cruise market in the past compared to China nowadays is that the Chinese government has a long-term strategy to enter into that market and that the shipyards entering the market are government controlled. In Japan and South Korea the attempts were driven by commercially driven shipyards where after a proper risk analysis they had not started to enter the cruise ship segment or when they started and failed they have withdrawn. In China the whole case is completely different as the government support is so strong that for many years they do not need to make money with building cruise ships. They just have to fulfill their strategic approach with the full support of the government without any relation and correlation to normal economic standards.
How will Meyer tackle the upcoming competition from China?
Due to the nature of our family business we are extremely customer-oriented with the focus of long-term business relationship combined with a high focus to innovate and deliver always the best and most efficient solutions for ship owners. In the end innovation combined with high quality and high reliability will be a key factor of success and to reach that we have a very loyal, encouraged and highly motivated and innovative workforce and this will be the backbone of our future success.
Large cruise vessels are now being built in Europe at yards that build only cruise vessels and practically no other products. Does that indicate that the only way to build cruise vessels competitively is to build at yards dedicated to cruise ships only?
Large cruise ships definitely need a very special infrastructure and also very special workforce. Therefore it is quite natural that a yard that will be successful in that market is not only specializing the whole organization but also the shipbuilding cluster around this ship type and due to the long lead time and the early commitment of cruise ship owners it is quite difficult to have other products in the portfolio as well at the same shipyard and the same slots.
Meyer group has today numerous wholly owned subsidiary companies for specialized operations like ship design, cabin manufacturing, AC systems, interior accommodation, turnkey piping system production, painting etc. Is further expansion of delegation to subsidiaries anticipated? What is the business rational of this development?
In the last twenty years we have created a very intelligent and highly competitive and innovative shipbuilding cluster with a good split between companies which only deliver products to Meyer shipyards and which are exclusive producers like the two cabin factories, which are fully occupied by the own demand and where we are completely relying on them as our single source suppliers. And we have in other areas other subsidiaries that compete with similar companies in the market, which we use to develop innovations first. However, the biggest part of the business we will work together with specialists in the whole world and only for a few dedicated areas we will have own subsidiaries or joint ventures and we feel very happy with this balance at the moment.
Laser technology based steel hull production in Papenburg/Germany’’
You personally represent the sixth generation of the Meyer family in the history of the group. Obviously the seventh generation is already stepping in. Do you see a smooth transition?
The smooth transition has already been proven since many years. My oldest son, Dr. Jan Meyer, is very successfully leading the shipyard in Turku while my second son, Tim Meyer, is focusing on the shipyard in Papenburg, and my third son, Dr. Paul Meyer, is CIO for all three shipyards and all affiliated companies of the Meyer Group, making sure that our IT systems are fit for the future. So they all have already taken over big responsibilities for years and we are talking a lot within the family, have a very good exchange, and my sons are running the day-to-day business and I can give my advice with 45 years of shipbuilding history when I am asked. The transition between my father and me worked extremely well and that helped me a lot to manage also the transfer to the next generation. This is all in good hands.
Finally, what overall message would you like to convey to the Finnish maritime industry cluster?
Our aim is to secure long-term shipbuilding success in Finland. We are investing heavily in the shipyard in Turku and we will be a very reliable and long-term-oriented owner of the shipyard who permanently likes to develop and optimize to stay competitive not only the own shipyard, but together with all the hundreds of suppliers in the Finnish maritime network. We are happy to be in Finland and are looking forward to a long and fruitful cooperation.
Finland’s maritime cluster is one of the country’s most significant business sectors with annual revenues of EUR 13 billion. The sector employs more than 50,000 people all over the country.
The positive outlooks that have prevailed in recent years are down to the development of autonomous maritime traffic among a group of pioneers, successful trials of the deployment of new, environmentally friendly technologies, and an unprecedented upswing in cruise ship construction.
The maritime cluster encompasses about 3,000 companies from various sectors, all of which are connected by their maritime expertise. Our diversity differentiates us from many other countries. Among our number are passenger and cargo ship owners, specialist ship owners, marine industries ranging from shipyards to software companies and startups, as well as the ports that handle almost 90 per cent of Finland’s foreign trade. Passenger traffic is also an important category. The Port of Helsinki is the busiest passenger port in Europe. In 2018, more than 12 million international passengers passed through the Port of Helsinki.Finland’s unique strength is the exceptionally open-minded collaboration, enabling innovative experimentation.
Finland’s unique strength is the exceptionally open-minded collaboration between entities, enabling innovative experimentation. Examples of this include the One Sea innovation ecosystem, which is promoting autonomous maritime traffic, the remote pilotage experiment, which is current under preparation, and the smart fairway, which is based on using data and data exchange in an entirely new way. Seafaring history was made in Finland at the beginning of December 2018 when the world’s first fully autonomous ferry sailed through the Turku archipelago.
The Finnish maritime cluster is also a pioneer in environmental innovation and it is at the global spearhead of the development and deployment of low-emission technologies that enhance energy efficiency. Liquefied natural gas (LNG), wind, electricity and biofuels manufactured from waste are already in use – they have long since graduated from the planning phase. Finland also has very strong Arctic expertise. The Baltic Sea could even be considered an “Arctic test laboratory”. Finnish seafaring expertise is unique, and the icy winter and difficult navigation conditions require seafarers and entities in the maritime industry to have special skills.
The entities in the maritime cluster have begun collaborating more closely in recent years. For example, the Breaking Waves 2018 event was held in Helsinki in December 2018, bringing together key players in the European maritime cluster to consider the keys to success in increasingly tough global competition. The event was part of one of Europe’s largest startup events, Slush.
Automation and digitalization will lead to an unprecedented transformation in seafaring. Climate change is challenging the maritime cluster to identify solutions for low-emission maritime traffic. This publication highlights the world-class Finnish expertise and innovations that will address these challenges.
Tiina Tuurnala Managing Director, Finnish Shipowners’ Association Chairman, Finnish maritime cluster
