Metamorphosis - Cruise Ship Portal

Christopher Kanal: In May 2009, you
became president and CEO. What is
your strategy for STX Europe?
Sang-Ho Shin: STX Europe’s strategy is to be
the leading builder of cruise and offshore
vessels. Having STX as owner gives us a
solid foundation to build upon.
STX Europe is a highly competent
organisation and I have been impressed by
the skills, experience and innovative ideas
among its employees. Although the last two
years have been challenging, I believe we are
back on track. Our main focus is to continue
to deliver on time, meeting or exceeding
customers’ expectations.
What has been your biggest challenge
so far?
As with the rest of the shipbuilding industry,
there has been a drop in orders. The market
slowdown and the lack of financing have
affected the ability and willingness of ship
owners to invest in new vessels. Whereas the
market for new ships has slowed in the short
term, we believe that the underlying demand
for specialised cruise and offshore vessels is
still there in the long term.
Several of STX Europe’s shipyards have
order backlogs that ensure high capacity
utilisation throughout 2010 and into 2011,
and the majority of financing needs for 2009
are secured. If the situation with limited
Insight > Shipbuilding, maintenance & repair
When South Korea’s STX bought Norway’s Aker Yards in 2008 for $924 million
and became STX Europe, it was a marriage between the best of eastern and
western shipbuilding. Christopher Kanal talks to recently appointed CEO
Sang-Ho Shin about the challenges of tackling the downturn, delivering the
Oasis of the Seas and remaining innovative when orders are down.
numbers of orders persists well into 2010 and
beyond, we will gradually increase excess
capacity, but with a strong order backlog for
many yards, STX Europe has a good
foundation for ongoing activity.
How is STX Europe coping with the
economic downturn?
We are relatively well positioned
compared with other shipbuilders.
Nevertheless, securing orders is essential
in order to maintain activity at our yards
and this is a key focus for STX Europe.
How will STX Europe compete as an
Asian/European company?
STX Europe is a well-established cruise
ship builder with an extensive network of
sub-suppliers based in Europe. The
competence for building highly specialised
cruise ships and offshore vessels has been
developed at our European yards over
many generations.
STX Europe will continue to build on
this position by utilising its experience in
order to remain at the forefront when it
comes to developing concepts and
innovative solutions.
Over the decades, STX Europe has
developed close relationships with some
of the world’s leading ship owners, and
one of its hallmarks is the ability to
create the world’s largest, most spectacular
cruise ships.
What are Europe’s strengths and
weaknesses in shipbuilding? What
are Asia’s advantages?
Generally, shipbuilders in Asia specialise in
high volume, labour-intensive production of
long vessel series, and their strengths are
related to outstanding efficiency,
productivity and speediness in addition to a
more favourable cost base.
In Europe, our competitive advantages
include the unique competence in building
advanced, customised ships which are
tailor-made for each customer. The
competence and experience of building
technologically advanced cruise ships,
ferries and offshore vessels are one of the
hallmarks of European shipbuilders.
What are the advantages of being
an international shipbuilder, with
one foot in Asia, at a time when
Asian yards are on the rise?
STX Europe has operations in six countries
located in Europe, Asia and South America.
Our global operations enable the optimal
utilisation of competence, capacity and
resources across the group and ensure
customer proximity.
With STX as owners, we have the
opportunity to exchange best practices, take
advantage of synergies and share knowledge
and experience. By combining expertise and
experience, we are learning from each other
and improving.
Does the dearth in orders allow
opportunities to develop new
concepts?
Despite low orders, it is important to
maintain activity to avoid losing
competence. Being a group of 15 shipyards,
STX Europe can allocate production to the
location where we can offer the customer
the most favourable conditions. This allows
us to move parts of the production from a
yard with a heavy workload to a yard with
free capacity.
Lower activity levels also allow us to focus
more on innovation and R&D as more
resources are available. By utilising the time
and resources available, we may have some
new concepts when the market returns and
customers start ordering ships.
What lessons did you learn from the
Oasis of the Seas project? What was
the biggest challenge in the design?
In general, prototypes are more challenging
than sister vessels as the design must be
developed from scratch. The Oasis of the
Seas is not only the world’s largest cruise
vessel; it is essentially a floating city
containing a wide range of entertainment
concepts and facilities.
How will the Oasis influence future
shipbuilding projects?
We definitely believe in building big and we
are confident that Royal Caribbean will have
great success with the Oasis of the Seas and
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