European shipbuilding in battle for survival

The Assembly of Assonave, the national association of shipbuilders, repairers and suppliers in Italy, met in Rome last week to discuss the plight of shipbuilding in Europe. Following three years of buoyant market conditions, the shipbuilding industry has seen a sharp 81% year-on-year decline in demand worldwide.
There has also been a substantial amount of cancellations and European builders are now at the risk of seeing their businesses fall below the threshold of sustainability.
Excess tonnage in merchant sectors and the consequent drop in charters have further impacted negatively on investments by shipowners who are already in difficulty due to the credit crunch. Postponed programmes have also occurred in the cruise business, although the sector is still dynamic, albeit less than in the past.
“The EU Commission appears to be aware of the need for an emergency intervention to support our industry with the added benefit of safer transport and improved environmental protection; support very different from indiscriminate aid to the industry which has already been agreed, for example in China and Korea,” said Antonia Tajani, vice president and EU commissioner for transport.
He explained that the measure should take the form of stimulating demand with a view to eliminating obsolete vessels (mainly ferries and Ro-Ros) from European waters and incentives for their substitution, via eco-bonus schemes. In Europe, 140 of these ferries are over 30 years old and many are in service in the Mediterranean.
Fleet renewal, which would not create surplus transport capacity as the vessels would be replacements, is in line with the previously announced EU transport policy and should be accompanied by a programme of financial support to investments.
“In view of the fact that the crisis is worsening, it is crucial that this scheme is approved quickly,” Corrado Antonini of Assonave said.