Challenges and Developments in Global Shipbuilding · PDF fileWE call it a severe global shipbuilding crisis ... cruiseship market Source: ... World Ultra Wealth Report 2015-2016 -Highlights

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Challenges and Developments
in Global Shipbuilding Industry
-brief overview of the current situation-
AgS Monitoring ShipbuildingThorsten Ludwig, Heino Bade, Heiko Messerschmidt
industriALL Global Union Shipbuilding-Shipbreaking Action Group Meeting
31 October - 1 November 2017, Rotterdam, Netherlands

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Some call it adjustment
2
480 545 411547
795
546667
1,3781,197 1,140
2,255
2,905
1,874
580
1,833
1,043
707
2,047
1,337
1,107
217 267
0
500
1,000
1,500
2,000
2,500
3,000
3,500
No
. of
Ship
s
Global Newbuilding Orders(vessels over 20.000 dwt)
Source: Clarksons (2017): Results Presentation, 14.08.2017

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3
Some call it concentration
Share of the TOP-TEN-YARDS on the national orderbook:
Number of yards accounting for 50% of the global orderbook 2432
Number of yards accounting for 75% of the global orderbook 59101
43%
60%
92%
76%
34%
49%
70%
60%
in 2017 in 2007
Source: Shipbuilding News, 14.09.2017

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Some call it consolidation
4
Number of active shipyards* worldwide
Active shipyards are those with at least one ship of 1,000+ GT on order; Updated 1.9.2017
Source: Clarkson, 14.09.2017
860 357
2007 2017

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Shipping lending: Shift to Asia-Pacific
5
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2011 2012 2013 2014 2015 2016
Asia-Pacific
USA
Europe
Total bn US$
2010 2011 2012 2013 2014 2015 2016Total bn US$
418.4 400.3 388.5 379.1 391.5 343.8 315.0
Europe 83,1 79,3 75,1 72,9 70,5 63,9 62,2USA 2,1 1,7 2,8 2,7 2,6 3,9 4,8Asia-Pacific
14,8 19,0 22,0 24,4 26,8 32,2 33,0
100 100 99,9 100 99,9 100 100
Source: Clarksons (2017): Results Presentation, 14.08.2017

Bezirk KsteWE call it a severe global shipbuilding crisis especially for the employees!
66
>18.000 jobs lost in
offshore-industry since
2012
No new orders since 2015
Capacity utilization: 50%
Mor ethan 33.000 jobs lost
in shipbuilding (Jan. 2015
bis Sept. 2016)
Reduction from 71.554 to
38.452 employees in
shipbuilding
Mass lay-offs in shipyards: appr. >
70.000 direct employees in
shipbuilding industriy lost since 2016
Lowest orderbook since 2003
State intervention to avoid closures
(f.e. DSME)
Huge newbuilding program for
Australian Navy
More than. 100 bln.. A$ fr appr.
ca. 60 ships
Newbuilding program provides
work for the next 30 years
Reduction of white lsit down to 59
yards
40 of these yards without any order in
2016
Important steps to enter the
cruiseship market
Source: AgS-Schiffbau-Monitoring
Reduction in new orders in 2016 of
83,3%
Kooperation betwen yards to
overwheln the crisi: : MHI, Imabari,
Oshima, Namura

Bezirk KsteDespite the crisis:Booming markets for cruiseships and superyachts
7
Length: 228.20m
Width: 28.70m
Crew: 776
Tonnage: 39,674
BRT
Passengers: 1,400
Length: 362.12m
Width: 66m
Crew: 2,384
Tonnage: 226,963
BRT
Passengers: 6,780
SS Rotterdam
1956
Harmony of the Seas
2016

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2,434,155
4,392,3004,932,750
7,163,6506,797,800
7,691,2208,088,620
22
3640
57 55
6469
0
10
20
30
40
50
60
70
80
2010 2014/08/21 2015/04/10 2015/08/10 2016/02/01 2016/12/21 2017/09/11
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
8,000,000
9,000,000
No
of
cru
ise
ship
s
Mio
. gt
gt No of cruiseships (>=200 lower berths)
Orderbooks for cruiseships (>= 200 lower berths)
8
Sources: cruiseindustynews.com; Seatrade Cruise News; own calulations

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Orderbooks for cruiseships (>= 200 lower berths)
9
CountryNo. ofships
Sum reportedPrice ($)
AverageLowerBerths
Average GT
SumGT
%-share oforderbook
by GT
China 2 1.500.000.000 4.000 133.500 267.000 3,3%
Croatia 2 252.000.000 264 12.635 25.270 0,3%
Finland 6 5.230.000.000 4.380 157.167 943.000 11,7%
France 11 11.179.000.000 4.336 167.873 1.846.600 22,8%
Germany 18 14.414.000.000 3.078 133.361 2.400.500 29,7%
Italy 27 15.328.000.000 2.354 94.635 2.555.150 31,6%
Norway 2 260.000.000 530 21.000 42.000 0,5%
Portugal 1 80.000.000 200 9.300 9.300 0,1%
Total 69 48.243.000.000 2.938 117.229 8.088.820 100%

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It`s still an European market
10
Europe97%
China3%
Orderbook for cruiseships by regionSept. 2017 (GT)

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dominated by two/three shipbuilders
11
Meyer Werft
GmbH / GER/FIN
34,1%
Fincantieri /Italy31.6%
STX France22.8%
China3.3%
Croatia0.3%
MV Werften
7.2%
Norway0.5%
Portugal0.1%
Orderbook for cruiseships bycountry/yard (GT)
Meyer Werft
GmbH / GER/FIN
34,1%Fincantieri/STX
France54.4%
China3.3%
Croatia0.3%
MV Werften
7.2%
Norway0.5%
Portugal0.1%
Orderbook for cruiseships bycountry/yard (GT)

Bezirk Kste building new ships for additional 203.000new passengers.
12
0
500
1000
1500
2000
2500
3000
3500
4000
4500
Portugal Croatia Norway Italy China Germany Finland France
Average reported price (Mio. US$) Average lower berths
Average lower berths
2.938
Average reported price
699 Mio. US$

Bezirk KsteChina:Getting prepared for the future cruise market
13
Carnival, CSSC and Fincantieri announced the delivery of a first 133,500t ship
from CSSCs Waigaoqiao yard in Shanghai due in 2023 with a second to follow
plus four more options.
$4bn investment by Carnival and CIC Capital
Developing a supply chain with logistics companies, design and shipfitting
specialists and cruise staff/crew training facilities and cruise port infrastructure
projects.
Chinese cruise companies ordering a newbuild from outside the country would
have to pay a prohibitive 30% tax on the cost price
More than 40% of Chinese passengers are under 40 years old (Europe: end 40s
end 50s)
51% of Chinese adults in their 20s say they are planning to take a cruise.
300 million peaople - the equivalent of the total population of North America or
Western Europe - of the population are genuine potential cruise prospects.
Source: Seatrade Cruise (2017): Cruise Shipbuilding in Asia 2017; August 2017

Bezirk KsteLooking at the Chinese ambitions in the case ofcruisehip industry
14
we suggest an intense and continuous
exchange between works councils and
trade unions representing the European
cruise ship industry!

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Superyachts: a growing (Asia-Pacific) market
15
69725104650
91375
12260051515
91150
0
50000
100000
150000
200000
250000
300000
350000
2015 2020
Per
son
en
ultra high net worthpopulation
Asia-Pacific
The Americas
Europe, Middele Eastans Africa 9.5
14.5
12.7
17.67.8
14.2
0
10
20
30
40
50
2015 2020
Trill
ion
US$
ultra high net worthassets
Asia-Pacific
The Americas
Europe, Middele Eastans Africa
Source: World Ultra Wealth Report 2015-2016 -Highlights
The superrich - overview

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Superyachts: Orderbook in detail (Jan. 2017)
16
China1%
Croatia1%
Finland1%
Greece1%
Australia1%Norway
1%Qatar
2%
Germany13%
Turkey16%
The Nether-
lands30%
Italy33%
Orderbook for superyachts (=> 50m) by No. of yachts
Finland1%
Greece1%China
1%Croatia
1%Qatar
1%Australia
2%Norway
2%
Turkey15%
Germany19%The
Nether-lands28%
Italy29%
Orderbook for superyachts (=> 50m)by total length
125
superyachts9,2 km total
length

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IG Metall activities in shipbuilding industry
17
Collective bargaining 2017/2018:
Voluntary reduction of working times to 28h/week
Increase of wages by 6%
New labour law to regulate temporary work & sub-contractors (2017):
Equal pay after nine months
Time limitation: max. 18 months
Temporary workers are not allowed to work as strike breakers
Reinforcement of information rights for works councils
Fight for new instrum

Documents

Challenges and Developments in Global Shipbuilding · PDF fileWE call it a severe global shipbuilding crisis ... cruiseship market Source: ... World Ultra Wealth Report 2015-2016 -Highlights