Feature 1 | SPANISH MARINE INDUSTRIES


Orderbook masks flaws in Spanish yard economics


A close look at the trend in newbuild orders over recent years sheds light on the impact of the global economic downturn for the Spanish shipbuilding sector and


raises the prospect of leaner times ahead, write Iñaki Carrera and Brian Reyes.


and ferries to trawlers, dredgers and offshore support vessels. There is enough work to keep most


S


yards busy through to 2012, a remarkable turnaround for a sector that only five years ago was on the brink of crisis. On the face of it, Spain’s shipbuilders have so


far shrugged off the credit crunch. But a closer look at the data suggests a


worrying shiſt. Last year, as the first signs of financial strife began to show, the orders began to fizzle out. Orders for newbuilds plunged 42% to


220,332 gt last year, according to the Gerencia del Sector Naval, the government body that monitors activity in the sector. Privately-owned yards in the Basque region captured the lion’s share of the business, securing 32.4% of all new contracts in tonnage terms, but the signs of a bleak trading climate were clearly evident. Te drop was largely the result of a dearth of


orders from foreign owners for large vessels. In terms of the number of vessels contracted,


the year-on-year change was little more than a slight dip from 79 to 75 ships. Ironically, the larger yards secured more orders last year – 30 ships in 2008 compared to 23 in 2007 – but representing a 22% reduction in tonnage terms, from 102,156gt in 2007 to 80,137gt last year. As for export vessels, the number of ships


ordered by foreign owners dropped from 56 ships in 2007 to 45 in 2008, while tonnage halved from 280,475gt two years ago to 140,185gt last year. Tis year the situation with new orders is


even worse. Yards in Spain’s Northern regions of Asturias,


Galicia and the Basque country – where most of the shipbuilding sector is concentrated – have secured just three new orders in 2009, clear evidence of how the economic slowdown is filtering through to the slipways.


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panish yards are currently bulging at the seams with contracts for specialised, high-tech, vessels ranging from tugs


Bleak future for Northern spanish yards


Yards in the north of Spain, where most of the shipbuilding sector is based, have secured just three orders this year with which to bolster a fast-dwindling workload. The workload at most yards is currently good for two years. Despite


hopes for a boom in orders on the back of the Russian fishing fleet renewal programme and other attractive projects of that nature, the present reality in terms of new business is bleak. In January this year, Asturian yard Astilleros Gondan signed a contract


with the Norwegian company Simon Møkster Shipping to build a multi field offshore support vessel, sister ship to the Stril Herkules which is already in operation. Gondan said its present orderbook is “the largest the yard has ever had”


and includes plans to work on six ships simultaneously, when the normal process is work on a maximum of three ships. The workload includes several tugs for Italian operator Neri for use in the port of Livorno. At the Galician yard Construcciones Navales P. Freire, the University of


Qatar’s order for a high-tech oceanographic vessel equipped with an ROV will generate 120,000 work hours for the Spanish company and see it through to the second half of 2011. The third order went to Metalships & Docks, also in Galicia. The €137million contract from an undisclosed Norwegian owner is for construction of an offshore vessel that will generate half a million hours of work at the yard. The 165m vessel, part of which has been built outside Spain, will be


among the largest units ever built at the yard and is the second such order secured in consecutive years. Metalships is also negotiating the construction of another offshore support vessel, the last in a five-ship series valued at €500million.


In Asturias, Astilleros Gondan won a


contract to build a 97m Multi Field Support Vessel for Norwegian owner Simon Møkster Shipping. West along the northern coastline, the


Galician yard Freire won an order to build an oceanographic survey vessel for the University of Qatar. Still in Galicia, Metalships & Docks won an order for a 165m offshore support vessel from


another Norwegian owner. Compared to 2007, this was paltry


pickings. “Te business has slowed down, primarily,


as a result of the sharp drop in freight rates, which has cooled interest in orders for cargo ships,” said one Basque yard manager. “Coupled to this is the difficulty that owners


are facing when it comes to securing financing for new vessels.”


The Naval Architect November 2009


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