Marine equipment suppliers upbeat on new order prospects

VDMA reported that in 2023 turnover was up 5% at EUR11.3 billion, however, new order intake stagnated last year.

While orders stagnated last year Martin Johannsmann, Chairman of the Executive Board of VDMA Marine Equipment and Systems (MES) and Managing Director of SKF Marine, was positive about new business in 2024 speaking at a VDMA MES press briefing. We expect business to develop well again this year. Last year's stagnating order intake was probably just a short breather after the very strong previous years,” he said.

Demand is seen as being driven both by newbuilding orders, which continue to be strong, and retrofits of existing vessels. “Shipowners are now not only continuing to invest in newbuilding but above all in the modernisation and retrofitting of the existing fleet. The IMO requirement for climate neutrality is certainly a strong driver here, especially in the global after sales service business.”

There could be some limiting factors to growth both from suppliers and customers though. "As an industry, we have developed the necessary technological solutions in a forward-looking and timely manner. However, we also realise that the enormous number of necessary retrofits could not only reach capacity limits but also monetary limits for operators," he added.

Related:Demand buoyed by emerging shipbuilders, says VDMA

VDMA members are not only manufacturing products to make shipping a greener industry but also produce the equipment in an environmentally friendly way. However EU regulations are putting a strain on manufacturers.

"Furthermore, it is important for us to produce in a climate-friendly way, especially at our domestic location, but also in Europe. As a maritime supplier, we are pioneers in many areas and have achieved good results in climate-friendly production,” said Dr Lars Greitsch, Member of the Board of VDMA Marine Equipment and Systems and Managing Director of Mecklenburger Metallguss GmbH.

“However, what is difficult to implement in a medium-sized production company is the ever-increasing effort involved in processing the growing EU regulations, such as the Corporate Sustainability Reporting Directive (CSRD) or the German Supply Chain Sustainability Act (LkSG). The necessary processing and reporting require more and more personnel capacity. At the same time, employees must become more and more productive in order to survive in international competition," he criticised.

The VDMA represents 3,600 German and European mechanical and plant engineering companies.