Engine builder Wärtsilä to shed 600 staffNews // July 20, 2015
Björn Rosengren, Poresident and CEO of engine builder Wärtsilä says the company is to shed 600 staff because of what he described as a "challenging" market and a decline in demand for engines for the offshore market.
Mr Rosengran said marine markets continue to suffer from weak vessel demand caused primarily by over capacity, depressed freight rates, and low oil prices. However, he said the company's marine order intake in the first half of 2015 was good, despite the challenging market conditions. "Still, we must ensure our future competitiveness in a low demand environment. Consequently, we have today announced plans to realign our Marine Solutions organisation," he said.
"Based on the market situation during 2014 and the GDP forecasts for 2015, the market for liquid and gas fuelled power generation is expected to remain challenging," he said. "Despite slower economic growth in the emerging markets, increased electricity demand will support power plant investments.
"In the OECD countries, low economic growth continues to limit demand for new power plants. Low gas prices are driving demand in the US. The megatrend towards distributed, flexible gas-fired power generation is evident. The increasing deployment in many parts of the world of intermittent renewable power, such as wind and solar, will require flexible solutions to balance fluctuations in the grid.
"The overall outlook for the shipping and shipbuilding markets is challenging," said Mr Rosengren. "Low oil prices continue to impact investments in exploration and development, thereby limiting the demand for offshore drilling and support vessels. Over capacity is affecting demand for vessels, particularly in the dry bulk and offshore markets.
On 17 July 2015, Wärtsilä announced plans to realign its Marine Solutions organisation, operations and resources in response to the sluggish global marine market situation. The realignment will mean the reduction of approximately 600 jobs, of which approximately 160 will be in Finland.