In an interview with HANSA, Vitaly Yusufov, owner of the shipyard group Nordic Yards, explains the specifics in the construction of »Murman«.
For the future, he continues to rely on the Russian market, but also sees potential in other segments such as cruise
Which of your shipyard’s achievements are you particularly proud of in the construction of the two vessels?
Vitaly Yusufov[ds_preview]: First of all I would like to highlight this – we are very proud indeed. Two unique, technologically complex rescue ships were built, high-tech vessels with a worldwide unique range of services. It was necessary to manage the shipyard’s long-standing expertise in a complex process together with a large number of outfitters, equipment suppliers and Russian partners. The result are two of the most modern ice-breaking rescue vessels in the world. And these are now also awarded, first in Russia, and now also in Germany, which pleases us.
Which was the greatest technical challenge?
Yusufov: The equipment level aboard the ships is very sophisticated and very complex, which was a challenge in itself. Moreover, everything has been installed in the smallest space. The latest technologies were required for this, both for the design and the manufacturing process, as well as for the intended use in Arctic waters. Russian rescue and navigation equipment had to be linked with German know-how, and, as usual for icebreaking vessels, this adheres to highest standards.
Are there any signals for further orders from the Russian market? How big is the influence of sanctions against Russia and the general economic situation on the original expectations and future prospects?
Yusufov: The »Murman« and »Beringov Proliv« are part of a national transport development programme. There is a very concrete need for these ships and great confidence has been placed in us by the order. We could justify this trust, the customer is very satisfied. This is an important signal for us. Nordic Yards is always ready to talk about further projects and cooperation and we are willing to continue to offer the Russian transport industry high-class innovative products at competitive prices – also in cooperation with Russian shipyards.
How big is the potential in case of a positive change?
Yusufov: Based on the efforts in policy – just take the aspirations of our home state of Mecklenburg-Vorpommern to organize a second Russia Day in times of sanctions – and the great interest of the German and the Russian economy, we are convinced that there will be effective collaboration again. We support this explicitly. Given Nordic Yards as an example, the significance of this process is easily understood. For the last six years Nordic Yards has handled about 100 project offers for the Russian market, which represents a share of about 20% in the sales focus. The percentage of sales of the Russian business (construction, refit and repair of vessels) amounted to about 30% at the same time. Russia continues to be a strategic market.
What are the business areas and markets in focus of Nordic Yards after the offshore sector has plunged into a crisis?
Yusufov: The market changes of recent decades in shipbuilding were partly dominated by crises, they were dramatic and – in a negative sense – unique, but after some time this mode was perceived as a »normal« state where you have to develop business and convince other stakeholders of this new »normality«. Our learning curve in this time included to get informed, to invest, to readjust, to pass one or other transformation process, and we have come to the conclusion that this will never really end.
The new challenge is rather to be much faster and more flexible when adapting to market conditions, to utilize »windows of opportunity«. Global uncertainty is large and politics and the global economy have massive influence on our business. The oil price is at a record low, the economic sanctions against Russia are still effective, the value creation potential triggered by energy transition is relocating abroad. Thus almost all strategic Nordic Yards business areas are affected by sharp slumps within a short time. The drama intensified in the course of last year with orders which seemed to be sure not obtained for some sales projects. The reasons were always the advantages of foreign competitors with respect to marketable financing instruments. The shipyard’s expertise was never doubted. To act under these difficult conditions is a real challenge.
On the other side, prospects in new business segments occur which are often unpredictable, at least short-term. Thus, for example, thanks to the positive market development for cruise, many potential customers requested orders in the last few weeks, requests which have significantly matured in project development and which may see a decision timely on the part of the customer. In addition to our references and our image we try to convince with our free capacity in the negotiations. Therefore, a disadvantage could turn into an advantage since punctual deliveries of the necessary quality become feasible only this way.
How concrete is the envisaged cooperation, e.g. with Lloyd Werft in Bremerhaven?
Yusufov: We are in intensive talks on concrete cooperation.
Do you want to further expand your shipyard network or downsize it – or is the present size just right?
Yusufov: At present, the current size is just right. The future efficient organization depends on quite a few market factors. As I said, the situation is nothing new for us. It will be necessary to adapt in time to flexibly exploit market opportunities and to risk new ways of thinking.
Interview: Krischan Förster
Krischan Förster
