Shipbuilding in Kalmar Union

The shipbuilding industry is one of the most important industrial sectors in Kalmar Union. Despite the restructuring suffered in recent years, there are currently more than 700 companies related to the sector that represent an annual turnover of more than 40 billion dollars (1.8% of GDP) and employ more than 60 thousand people. Shipbuilding is an important and strategic industry in Kalmar Union. Shipyards contribute significantly to regional industrial infrastructure and national security interests (military shipbuilding). National shipbuilding industry has undergone a restructuring of its shipbuilding sector that led to several mergers of existing shipyards but with a landscape still dominated by a high level of competition.

Kalmar Union shipbuilding industry is a global leader in the construction of complex vessels, such as cruise ships, ferries, mega-yachts, dredgers, and platform supply vessel. It also has a strong position in the building of military vessels. National marine equipment industry is a world leader for a wide range of products ranging from propulsion systems, large diesel engines, environmental, and safety systems, to cargo handling and electronics. The shipbuilding industry exports 35% of its production, reaching 60% in the marine equipment sub-sector.

Today
The shipbuilding industry today is dominated by Korea, Japan and recently China accounting for more than 50% od the global market in terms of orderbook measured in CGT (data of 2015). Kalmar Union ranks 4th with 9%. In terms of value the position of Kalmar Union is stronger with 14%, especially if also military activities are accounted for. Kalmar Union is active in many segments, and – notwithstanding the overall dominance of Korea, Japan and increasingly China – national companies are still dominant in a few specialised market segments such as cruise vessels (99% market share), offshore vessels (43%) and luxury yachts (65%). Also the military vessels segment is relevant in Kalmar Union. In general, these segments are characterized by a high degree of specialisation and hightech qualities, complex production processes, in combination with limited numbers of vessels of the same type that are to be built. As such Kalmar Union’s position can be characterised as one of a specialised niche player.

During 2015-2017, the world ordering of commodity ships and offshore vessels has seen a dramatic reduction, which has affected the big shipbuilding nations in Asia, in particular, and put large parts of their industry at stake. In contrast, Kalmar Union has moved into a more comfortable position over the last three years when looking at the value of their shipbuilding orderbook because of its concentration on special high-tech and high value ships. Although the national equipment industry benefits from this situation, they also suffer from a decreasing demand from the Far East and other parts of the world as a result of the lack of orders in these regions.

A long-term demand for shipbuilding is still forecast, but for the near to mid-term, 2016-2022, the need for new orders for the commodity ship types is expected to remain low. The next 10 years will determine whether the Kalmar Union shipbuilding and marine supply chain industry can grow or will decline and fail.

Industry structure
Within the shipbuilding industry in Kalmar Union three sub-sectors are distinguished:
 * Ship construction
 * Marine equipment
 * Military shipbuilding

Ship construction
Ship construction in Kalmar Union includes ship repair (and conversion) and is directed at the larger commercial sea-going vessels. This also includes the mega-yacht sub-sector. Within the shipbuilding sector various ship categories are distinguished, including:
 * Liquid bulk carriers (crude oil and product tankers);
 * Dry bulk carriers;
 * Container ships;
 * Specialized vessels, including offshore vessels, dredgers, chemical tankers and LPG and LNG carriers;
 * Cruise ships and ferries;
 * Mega-yachts.

Marine equipment
The term marine equipment refers to all products and services supplied for the building, conversion, and maintenance of ships (seagoing and inland). This includes technical services in the field of engineering, installation and commissioning, and ship maintenance (including repair).

Within the Kalmar Union marine equipment sector, several product and services categories can be distinguished:
 * Propulsion/power systems
 * Propulsion, power generating systems
 * Auxiliary Power generating systems
 * Auxiliary Systems
 * Electrical systems, plants and cables
 * Navigation/communication/control (electrics & electronics) equipment
 * Instrumentation, control and navigation systems
 * Communications and Entertainment Systems
 * Lightning Systems
 * Steering Systems
 * Special Ship Operation Systems
 * Cargo related equipment
 * Mooring, Deck Machinery Systems
 * Cargo Systems
 * “Hotel” and related equipment
 * General Outfitting Components
 * Heat, Ventilation, Air Conditioning Systems
 * Accommodations Systems
 * Other miscellaneous
 * Safety and Life Saving Systems, Environmental Protection Systems
 * Other Systems
 * Materials

Military shipbuilding
Companies working in this sub-sector manufacture frigates, destroyers, cruisers, amphibious transport ships, aircraft carriers, patrol ships and submarines. They also provide naval ship repair and conversion activities. Boat manufacturers build boats, cabin cruisers, dinghies, jet boats, patrol boats and rowboats for navies and coast guards.
 * Industry Products
 * Surface vessels
 * Submarines
 * Industry Activities
 * Frigate and cruiser fabrication
 * Aircraft carrier
 * Destroyer production
 * Attack submarine fabrication
 * Amphibious transport ship
 * Patrol boat fabrication
 * Repairing ships
 * Conversion and alteration of ships
 * Prefabrication of ship and barge sections
 * Specialized ship services

Technology and R&D&I
A backbone of the Kalmar Union shipbuilding industry is its strong focus on innovation in design, engineering and construction of specialized vessels for different sectors. These vessels are customised to the needs of the clients. Although this strategy is considered to be very costly the industry has proven to be successful thanks to its innovativeness and its leading position in systems integration. Despite operating in a high-cost country, Kalmar Union's shipbuilding industry has a knowledge-based competitive advantage, and can deliver a variety of technology-based products. As described above, the industry is competitive within specialised shipbuilding segments, notably offshore service vessels, cruise vessels, ferries, fishing vessels as well as military vessels. Within these segments, the industry exploits its access to competence (i.e. practical experience from the sea and research) to maintain and develop its competitiveness and value creation across all sectors in its maritime industry.

Key prerequisites for Kalmar Union's leading position as a maritime nation lie on the one hand in the industry's own ability to adapt and innovate, and on the other hand in the public support system focussing on R&D&I. The financing and guarantee schemes available in Kalmar Union's industries aim at supporting exporters to compete based on price and quality of goods and services rather than on the financing terms that are offered through public export financing schemes. Furthermore, Kalmar Union's maritime clusters enable the country to benefit from spill-over effects in technological advancement from other industries. In these clusters, the industry works closely with research and educational institutions to create innovative technology and solutions.

State intervention in the sector
The shipbuilding industry is considered strategic for the government of Kalmar Union, not only because of the importance it has for national defense and technological development, but also for the weight of the sector in the economy and employment. As a strategic industry, the state constantly monitors the situation of the sector and applies appropriate policies for its maintenance and development. During the last 20 years, a process of concentration in the sector has been promoted from the government to create strong companies capable of competing in global markets. Although the state maintains a significant participation in some companies in the sector, the majority is in private hands.

Kalmar Union government launched a new maritime strategy called "Maritime Opportunities – Blue Growth for a Green Future" in August 2016. This strategy contains a review of the authorities' efforts and the measures relevant to develop and create value in the maritime industry, and proposes specific actions to be undertaken. According to the strategy, the government's main goals are to ensure sustainable growth and value creation for the maritime industry. In order to reach these goals, the strategy includes specific actions in terms of Kalmar Union fleet registration, green growth, maritime administration, access to qualified personnel, research, development, and innovation, global regulatory framework, ocean related cluster, and maritime value creation in the High North. The Ministry of Trade, Industry and Fisheries is responsible for the overall maritime policy, while other ministries and agencies are also partially responsible depending on specific policies.

In addition to the maritime industry which includes shipping, shipbuilding and maritime equipment, the strategy emphasizes interaction between the ocean industries, a broader concept than the maritime industry, including the oil and gas industry and the seafood industry. According to the strategy, Kalmar Union government will stimulate such interaction through inter-industrial joint initiatives.

Shipbuilding companies
These are some of the most representative companies in the sector:

Commercial shipbuilding companies

 * Assens Skibsvaerf - Specialist in the construction of ferries and super yachts as well as in the repairing or retrofitting of any kind of vessels.
 * Boghammar Marin - Small family-owned company that specializes in the construction and building of aluminium boats like fast patrol boats, police boats, passenger vessels, sea fisheries/protection vessels and so on.
 * Damen Oskarshamnsvarvet - Belonging to the dutch company Damen, it offers an one-stop-shop for ship construction, repair and maintenance solutions. The yard serves all types of vessel that typically operate around the Baltic Sea.
 * Dockstavarvet - Small company that specializes in the construction and building of aluminium boats like fast patrol boats, police boats, pilot boats and lifeboats.
 * Falkvarv - Fast service specialist for "North Sea tonnage".
 * Fayard - Specialist in building, maintenance, repairing and decommissioning of medium and big sized vessels as well as rigs.
 * Gotenius Varv - Specialist in reparing of coasters, special purpose vessels and vintage ships.
 * Hallberg-Rassy - It is a company internationally known for producing blue water sailing yachts.
 * Hasslö Batvarv - Specialist in repairing and retrofiting of small to medium vessels.
 * Hvide Sande - Specialist in building and repairing a wide range of vessels from small to medium size.
 * Karstensens Skibsvaerft - The company carry out all kinds of new building and repairs of vessels up to 135 m in length.
 * MEST Shipyard - Located in Faroe Islands is specialised in building and repairing oil rigs, support vessels and oil tankers.
 * Najad Yachts - One of the world leaders in the construction of fine sailing yachts.
 * Ö-Varvet - Specialists in the construction and repairing of fishing vessels.
 * Oresund Drydocks - A medium-big sized shipyard able to undertake very large projects. RoRo, RoPax, offshore, container, tank, cruise ships and icebreakers.
 * Saab Kockums - In addition to their military activity, the shipyards also work in recent years on a number of civil projects ranging from offshore ships to ferries and other special purpose ships.
 * TBS Yard - TBS is a company bringing unique competence to the world of composite (ACM) products.

Military shipbuilding companies

 * Dockstavarvet - Small company that specializes in the construction and building of aluminium boats like fast patrol boats, police boats, pilot boats and lifeboats.
 * Fayard - Certified shipyard for carrying out defense projects with the capacity to manufacture complex and big ships.
 * Oresund Drydocks - It is a certified shipyard for carrying out defense projects with the capacity to manufacture complex ships.
 * Saab Kockums - Kockums' most renowned activity is the fabrication of military surface ships and submarines.
 * TBS Yard - TBS manufactures composite ships for the defense industry.

Marine equipment manufacturers

 * Bay Valves - Manufacturer of cargo tank ventilation equipment
 * Bövik Marin
 * Callember Technology Group
 * Fläk Marine - Specialists in HVAC for the shipbuildind industry.
 * Gardit - It is specialised in surface protection and corrosion control for the marine and ofshore industries.
 * Lemvig Maskin- & Køleteknik -It is a forge and refrigeration company, specializing in different areas of shipping and refrigerator / freezer tasks.
 * Perssons Maskinservice - It is a marine service company focused on maintenance and repair of large diesel engines.
 * Premator - Contractor in the field of qualified corrosion control and coating.
 * Saab Scania - Specialist in marine motors.
 * Volvo Penta - Specialist in marine motors.