The Assembly of Associates and Aggregates of ASSONAVE was held today in Rome, in private form, the Association that represents most of the Italian shipbuilding industry, from which an increasingly "polarized" picture of the shipbuilding sector emerged, both in terms of types of vessels and geography.
In particular, 2015 recorded an overall demand of 41 million GRT (compensated gross tonnage), with a decrease of more than 10% compared to 2014, with some sectors in sharp decline, such as the Offshore sector, which in 2015 saw only one drill rig ordered, and more booming, such as the cruise industry, which with a record 19 new units ordered, brings its order book to 47 large vessels at the end of 2015. The military sector also saw significant growth in 2015 with 96 orders, for a value of Euro 29,6 billion ( +74% vs 2014), while the yacht market sees a slowdown in orders over 60 meters, and a recovery in orders for smaller sizes.
The first half of 2016 sees a particularly sluggish start for the merchant ship sector, which records total new orders for only 6,8 million cgt. The trend towards market polarization is confirmed once again with a Cruise sector in sharp contrast, thanks to even 14 further new orders finalized in the semester (which would even become 25, also counting the Letters of Intent still to be finalised), the Offshore sector practically zeroed, and that of yachts gradually recovering. Lastly, the military orders were confirmed as satisfactory (41 new orders, for 8,8 billion euros, without counting the Australian Navy's total program of 34 billion euros relating to 12 submarines).
In this context, in the first half of 2016, the Asian shipbuilding market share in terms of new orders dropped to 68% (87% in 2014) while the boom in demand for cruise ships led the European shipbuilding industry to reach share of 24% (7% in 2014), thanks also to the important contribution of the Italian shipbuilding industry, led by Fincantieri. In this context Korea reaches its historic low with only 13% of the share (27% in 2014). The data becomes even more surprising if we analyze the data provided by Clarkson for the first half of 2016, which indicate that Europe has acquired new orders for a value share that exceeds 60%, an objectively unprecedented figure.
2015 and the first half of 2016 confirmed the polarization tendency also in the ship repair and conversion sector. On the one hand, the low level of freight rates has prompted the shipping industry to economize on the costs of maintenance and ordinary repairs, on the other, the request for modernization interventions on passenger ships, as well as on yachts, has reached decidedly high levels.
In this context, the Italian shipbuilding industry as a whole found itself on the right side of the market, also thanks to its strategic capacity, with the group Fincantieri which has achieved a record total order backlog of 21,8 billion corresponding to over 5 years of work, if compared to 2015 revenues. In particular, Fincantieri has a cruise order book of 21 units with deliveries extending until 2022, while in the military market the order book, thanks to the 9 Italian units deriving from the so-called. "naval law" and the prestigious order for 7 units (4 Corvettes, 2 OPVs, 1 LPD) acquired in Qatar, reaches 43 units, with deliveries extending until 2026.
In light of this, the Italian shipbuilding industry therefore, like the European one, it is recovering very well from a long period of crisis and is stronger than before: in the face of the offshore crisis deriving from the collapse in oil prices and therefore in the related ship orders, there is the market cruise industry, which has never been so dynamic.
China and Korea remain the top two countries in the world for order books for merchant ships (but the short-term trend is all in favor of Europe), but the 3 major Korean manufacturers have reported losses of over 7 billion dollars. Europe is third, but in far better shape, as it has seen the passenger ship market explode, while suffering like everyone else from the offshore slump.
The challenge for the next few years will be the creation of the numerous prototypes in the order book of our companies. New and important investments in technological and productive innovation will be necessary. Here the support of the Government will be essential and Assonave has registered with satisfaction that the 2016 Stability Law confirmed allocations of 100 million to support the investments made for product and process innovation in the naval sector. Equally important allocations are expected for 2017, bearing in mind that since 2011 Italy has supported innovation in shipbuilding much less than all the other European competitors.
In the face of industrial consolidation in the shipbuilding sector, Assonave believes it is inevitable and positive that the Associative Representative also begins a process of aggregation to maximize its impact capacity. At the same time, Assonave asks the Government to start a similar one process of simplification and aggregation in the "institutional governance" of the maritime economy, today fragmented among numerous ministries at a central level, as well as among the various territorial articulations of the public apparatus. A Secretariat of the Sea, with an authoritative political leader, would be an important step forward in this direction.
Assonave also welcomes concentration and rationalisation initiated by the Government and Cassa Depositi e Prestiti, of the offers of the Export Credit Agencies, also for the benefit of the shipbuilding industry.
Italian shipbuilders must remain many steps ahead of their Asian competitors in introducing high-level cutting-edge technologies, in order to continue to be among the world leaders in the sector. Assonave therefore welcomes the Government's efforts to support the investments of shipbuilders. It mainly refers to the new and important “Industry 4.0” programme, recently presented by the Minister of Economic Development Carlo Calenda, which can be a major factor in increasing the competitiveness of the Italian manufacturing industry.
At the end of the works, which saw the renewal of corporate offices, the Amb. Vincenzo Petrone was confirmed as President of the Association for the three-year period 2016-2018.
On the sidelines of the meeting, the President Vincenzo Petrone commented: “Italy, in order to maintain the world leadership achieved in the construction of cruise ships and yachts and to continue playing a leading role in the military sector, it must invest more and more in innovation and in the development of new technologies. The same crisis that Offshore is experiencing today could tomorrow constitute an opportunity, if the Italian manufacturers move in the same direction in this sector as well.
In 2017, Assonave will contribute to improving the competitive capacity of its Associates with specific activities in the areas of representation and lobbying, promoting cohesion and cooperation between its Associates. We intend to help resolve the tensions present in the national boating association's representation, facilitating the return to Confindustria of Nautica Italiana and the important companies that are part of it, in compliance with the Confindustria statute. We will then work to contribute to the creation of a "Sector Representative", initially with the same Assonave, Confitarma and Ucina, to then aggregate the other subjects representing "the economy of the sea", up to the creation of a unitary "Sector Federation". Petrone then concluded: "In the same way, we ask to have a single interlocutor at an institutional level, able to propose and implement in a coordinated manner the measures that the Government will adopt to support the Economy of the Sea, a real pillar of the Italian economy. In this way, our country would also be listened to more in Europe in protecting its interests."
