Maritime CEO

Maritime CEO 100: Yards

 

Singapore: Launched in late January by shipping media veterans at Asia Shipping Media, Maritime CEO this week celebrates its 100th interview.
 
Every day we catch up with a top name in shipping to gauge their thoughts on the industry, with every Friday guaranteed to be a shipowner interview. Our aim is to cover every facet of the industry, but only from the viewpoint of the top echelon of management. In our first 100 reports we have met up with the heads of:
 
·     the world’s largest containerline
·     the world’s largest breakbulk operator
·     the world’s largest dry bulk operator
·     the world’s largest LPG operator
·     the world’s largest car carrier operator
·     the world’s largest shipowning grouping
 
Every day this week we bring highlights from our first 100 interviews, split into segments. Tuesday sees the Maritime CEO team – with 17 correspondents across the globe – focus on shipbuilding.
 
“Even the darkest night will end and the sun will rise”
Victor Hugo
 
While other shipyards have struggled Malaysia’s Nam Cheong has been a near-constant in the news in recent months, becoming one of the busiest companies in the offshore support sector.
 
With a history that stretches back to 1968 Malaysia’s number one shipbuilder with a 12 ha yard in Miri has been outsourcing the bulk of its ship orders to a number of Chinese yards since 2006 as business ramped up.
 
Leong Seng Keat, executive director of the Malaysian OSV giant, maintained that the shallow water market is “recession-proof”. This has seen pent-up demand for OSVs from local Malaysian players, but also from across the world, in places such as Australia, West Africa and Southeast Asia. Whereas Nam Cheong’s client base eight years ago was 100% Malaysian it is now 50:50 between locals and overseas companies.
 
The ability to go global for business has not been lost on Govert Hamers either. The president of the Dutch yard IHC Merwede told Maritime CEO a month ago that its traditional focus on European clients has shifted dramatically in the past couple of years, with Asia to the fore, and plans to grow elsewhere notably Brazil and Australia. 
 
“We have realized that we need to be positioned well after the crisis is over,” he said, “and we wanted to have a worldwide presence, not just salesman flying every now and then, we want to have a number of regional headquarters with knowledge people and decision power who are close to the market.”
 
On the shipbuilding downturn Hamers reckoned it was not over, with still too much overcapacity and prices still likely to drop further.
 
Agreed, said another Maritime CEO interviewee, Arindam Ganguli, who runs Shoft Shipyard located in Gujarat on India’s west coast, but with one important caveat.
 
Increased political tensions are the great hidden beneficiary to troubled shipyards around the world, with defence spending escalating, the boss of the leading Indian shipbuilder told this site in March this year.
 
“There is one difference in today's downturn,” Ganguli said. “Today, the demands of the defence sector have grown very significantly. That is helping shipyards, at least Indian shipyards, to stay alive. One may draw a parallel – though not a very happy parallel – to the great surge in shipbuilding during the last world war.”
 
Ganguli has a point. When one considers that 90% of ships built are now done so in Asia, with China, Korea and Japan to the fore, the various spats over maritime boundaries that have flared in the region lately have seen plenty of sabre rattling and no shortage of talk of naval buildups.
 
Ganguli said newbuild prices have now bottomed out. “If shipyards try to grab orders by going any lower then they will only hasten their own bankruptcy,” he said, adding: “Similarly if speculative buyers think that driving further bargains today will be to their advantage, they will soon realise their mistake. Ships are not a packet of detergent which one can afford to throw away if found unsatisfactory and replaced by another brand. Bad ships acquired at bad prices can ruin a shipowner.”
 
The shipbuilding downturn has made yards get super creative in their marketing, the head of online shipbuilding database Worldyards, Matthew Flynn, told us eight days ago.
 
Flynn said shipbuilders are suffering from “dramatic overcapacity”. It is this excess of yards, Flynn argued, that is actually spurring ship innovation and the eco ship era.
 
 “The yards are hungry so they are pulling out the stops to build ships that are efficient rather than playing the game of efficient shipbuilding,” he explained, before adding: “More ship for the buck rather than building more ships.”
 
Maritime CEO’s remit is to always interview the heads of maritime firms, often looking to provide global industry perspectives. However, local points of view also create strong viewing figures such as the moment nearly three weeks ago when we caught up with Vyborg Shipyard's general director Alexander Solovyev. The 65-year-old company is one of the largest shipbuilding companies in the northwest of Russia and a leader in the field of icebreakers and yet has received little coverage in international media. Maritime CEO was, and is, happy to shine a light on companies of all shapes and sizes. {11/06/13]
 
 
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NEED TO KNOW:  Maritime CEO Magazine
Maritime CEO is launching a quarterly magazine with the first issue publishing in August. The hardcopy of the magazine will be distributed to c-level executives around the globe and the online version will be available free of charge to all visitors to this site. This is your chance to advertise to the very top people in shipping, learn more via our media kit HERE and for special launch issue rates contact Grant Rowles on grant@asiashippingmedia.com.

 

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