German shipbuilders’ association VSM’s chief executive Reinhard Luken says the €20bn ($23.12bn) orderbook in the country is the highest ever, according to his statistics.

The mid-2018 total compares with year-end figures of €17.6bn in 2017, €18.5bn (2016), €13.0bn (2015), €10bn (2014) and €9bn (2013).

We are in a world of ever faster changes and that is very hard to manage if you are very small

Reinhard Luken

“It is clearly a sound basis to do planning and optimise production,” he said.

The current orderbook of 55 vessels of 2.9 million gt is dominated by cruiseships.

But so many yards have entered cruiseship building that he expects the market to tighten.

And he is not surprised at the difficulties faced by some yards now building expedition cruise vessels. “For offshore players this is a completely different market, a different value chain, different types of complexities. Adapting is a challenge,” said Luken.

Vard, he noted, has the advantage of being part of experienced cruiseship builder Fincantieri.

Luken said European shipbuilding has seen plenty of consolidation, including Lurssen’s acquisitions in Germany of Blohm+Voss, but more could follow.

“We are in a world of ever faster changes and that is very hard to manage if you are very small,” he said.

Record orderbook

Despite the record German orderbook, the number of individual vessels delivered each year has fallen dramatically. Larger ships but fewer, a trend impacting the country’s multibillion-euro equipment supply sector.

Meanwhile, Luken described as “alarming” the number of European ferry and ropax orders lost to China. He also predicted that Chinese yards may pile up losses on those contracts and this could affect the quality of the vessels delivered.

“This is a sensitive product where you need to know what you are doing,” said Luken.”We believe a lot of these projects were based on distorted pricing, the same thing we have been complaining about for a long time.”

Meanwhile, plenty is written about the success of Meyer Werft but less so about compatriot MV Werften, which is building various cruiseships for brands belonging to its Genting Hong Kong owner.

According to Luken, MV Werften is “taking the right investment decisions and things are moving". Pace of production is increasing and while the builder will inevitably face headwinds, “everyone is pulling up their sleeves and are fully engaged”.