A part of Watch Media

ShippingWatchSunday5 February 2023

  • Search
  • Log in
  • Carriers
  • Logistics
  • Regulation
  • Suppliers
  • Search
  • Log in
  • Latest
  • Search
  • Log in
  • Carriers
  • Logistics
  • Regulation
  • Suppliers
  • Offshore
  • Ports
07/08/2015at 10:01

MAN: Carriers defy the oil price plunge

The carriers' interest in what is probably the most important single component in the retrofit program at the Danish-German engine producer, the so-called Kappel propeller, is not affected by the oil price being cut in half.
Photo: Arkiv/POLFOTO
BY TOMAS KRISTIANSEN

With an oil price which once again has dropped below USD 50 per barrel, the savings of investing in retrofit or energy efficient measures are obviously less than when the price was over USD 100.

The repayment period has increased since the oil price was cut in half, but the major Danish-German engine producer MAN Diesel & Turbo has not noted that the interest in improving operations through retrofit has decreased. At least not when it comes to one of the company's key products - the so called Kappel propeller - which is the ship propeller that the company bought the rights for in 2012. The basic description is that the sides are slightly bent upwards, like on new airplane wings.

Try a free 40-day trial subscription to ShippingWatch

According to the Head of Propulsion at MAN Diesel & Turbo, Thomas Leander, demand has increased in the past few years, and the company has not experienced carriers backing out using the explanation that it no longer pays off to invest in optimizing operations.

"In most cases, the repayment period is about two years even with the current oil price, and this is still very attractive for the carriers," he tells ShippingWatch.

Doubling of retrofit

MAN Diesel & Turbo does not publish the revenue data for its products, but the company reports that the Kappel propeller number 100 is approaching. Meanwhile, Thomas Leander adds that the retrofit business in the propeller segment has doubled in just a few years.

"We are experiencing a steady increase in interest and a growing orderbook. Besides the savings for the one ship, we experience that for instance the German banks put pressure on the shipowners to have their fleets retrofitted. The banks want to secure their assets this way, they say," notes Thomas Leander. By securing a better operating economy for the vessel, the value increases and this makes it more attractive on the charter market.

Try a free 40-day trial subscription to ShippingWatch

The benefit per ship of retrofitting and of replacing a traditional propeller with a Kappel propeller can vary significantly and depends entirely on the type of vessel. But overall, the assessment is that the savings for a newly built container ship is between 1-2 percent, but that it is significantly more for an older ship being retrofitted. MAN's propeller market in newbuilding and retrofit is, respectively, about 50/50.

The large Kappel propellers are built in Asia, and MAN Diesel & Turbo in Frederikshavn in Denmark handles the design and marketing. The small propellers with blades that can be twisted are assembled in Frederikshavn, however. The propeller is thus - along with the rest of the propeller retrofit program - considered very important for the staff in Frederikshavn, which has been relatively stable since the engine production was moved from the factory and now mainly takes place in Asia on a license from MAN.

11 vessels from Odfjell

Recently, MAN Diesel & Turbo landed an order for 11 ships from Norwegian Odfjell, which wants to retrofit a series of product tankers. Just as is the case for a number of other contracts these days, the ships will need to sail slower and with more varied speeds than before. This is why the propellers and some of the other equipment must be replaced, so that it works with the new speed.

Try a free 40-day trial subscription to ShippingWatch

A positive development in the retrofit business is important for MAN Diesel & Turbo at a time where the newbuilding of specific types of vessels has basically come to a halt. This mainly concerns dry bulk ships, whereas there is still good activity in container ships, where the company traditionally has been well-positioned.

"There are more newbuildings on their way into the tanker segment in addition to container, but on the bulk market the newbuilding market has completely stopped and this means that we are experiencing an equalization between the segments, so we still have to fight to land orders. There are no signs right now that the market will generate more orders at this point in time," said CEO Thomas S. Knudsen in an interview with ShippingWatch in July this year.

MAN: We have our share of the market for ultra-ships

Oil price drops to less than USD 50

Orders for newbuildings down to 1999 level 

Related articles:

  • MAN: We have our share of the market for ultra-ships

  • Photo: COSL

    Oil price drops to less than USD 50

    For subscribers

  • Photo: APM Terminals

    Orders for newbuildings down to 1999 level

Sign up for our newsletter

Stay ahead of development by receiving our newsletter on the latest sector knowledge.

!
Newsletter terms

Front page now

Palle Laursen has spent almost his entire career at Maersk where he began as a maritime engineer in 1998. He now retires as chief of fleet. | Foto: Maersk
Container

Maersk's chief of fleet leaves after 25 years as reshuffling continues

Palle Laursen leaves Maersk after 25 years in the company. Another leader is also out the door, as Vincent Clerc continues to put his stamp on the shipping giant.
  • Vincent Clerc sets brand new executive team
  • New executive team to steer Maersk through recession: "A lot of highly experienced industry people"

For subscribers

Lars Jensen is a shipping analyst and founder of consultancy Vespucci Maritime. In the future, he will write two opinion pieces for ShippingWatch a month. | Foto: Magnus Møller
Container

Opinion: Maersk and MSC heading for direct confrontation over customers

For subscribers

Foto: Uncredited/AP/Ritzau Scanpix
Tanker

New Russia sanctions could eventually leave Europe in drastic need of diesel

For subscribers

"Vi har nogle gange haft ry for at have et kortere aftræk end vores konkurrenter. Du kan godt regne med, at det ry vil vi gerne holde fast i," siger Jens Lund, driftsdirektør i DSV. | Foto: DSV
Logistics

DSV denies savings plan but is attentive to costs

For subscribers

Foto: PR / Euronav
Tanker

Euronav CEO defends decision to retain large dividend

For subscribers

Foto: Mike Blake/REUTERS / X00030
Container

Freight rates out of China continue to plummet

Further reading

Wärtsilä's financial loss after the Russian exit has been felt in all corners of the business, says head of marine systems Tamara de Gruyter. | Foto: Wärtsilä
Suppliers

Wärtsilä had to abandon valuable projects after departure from Russia

The Finnish supplier has called off a string of projects with a total value of roughly EUR 240m following the Ukraine war.

For subscribers

Lars Jensen is a shipping analyst and founder of consultancy Vespucci Maritime. In the future, he will write two opinion pieces for ShippingWatch a month. | Foto: Magnus Møller
Container

Opinion: Maersk and MSC heading for direct confrontation over customers

Ahead of the 2M alliance’s final termination in 2025, Maersk and MSC will probably try to steal customers from each other, writes analyst Lars Jensen.

For subscribers

Hans Lind Dollerup er ny managing director for Dan-Bunkerings europæiske forretning. Selskabet har også hyret en ny kommerciel direktør i Europa. | Foto: Dan-Bunkering
Suppliers

Dan-Bunkering hires new management for Europe

Dan-Bunkering has compiled a new management team for the European business. The two new directors were both found internally.

For subscribers

Latest news

  • Freight rates out of China continue to plummet – 3 Feb
  • Ziton wins multi-year deal with German utility – 3 Feb
  • Euronav CEO defends decision to retain large dividend – 3 Feb
  • DSV denies savings plan but is attentive to costs – 3 Feb
  • DP World to construct large port terminal in India – 3 Feb
  • Maersk's chief of fleet leaves after 25 years as reshuffling continues – 3 Feb
  • Clarksons banks on offshore wind with new US office – 3 Feb
  • Opinion: Maersk and MSC heading for direct confrontation over customers – 3 Feb
  • Bulgaria to keep up export flows of Russian fuels to Ukraine – 3 Feb
  • New Russia sanctions could eventually leave Europe in drastic need of diesel – 3 Feb
See all

Jobs

  • Fleet Manager

  • Senior Financial Controller

  • Ambitious employee for Shipping office wanted

  • Senior Lead, Human Sustainability at Sea

  • Foundation Package Manager - Offshore wind industry

  • Copenhagen Shipping Company is hiring a skilled cargo broker

  • Financial Controller for International Shipping Company

  • Chartering Manager for Lauritzen Bulkers A/S

Jobs

  • Fleet Manager

  • Senior Financial Controller

  • Ambitious employee for Shipping office wanted

  • Senior Lead, Human Sustainability at Sea

  • Foundation Package Manager - Offshore wind industry

  • Copenhagen Shipping Company is hiring a skilled cargo broker

  • Financial Controller for International Shipping Company

  • Chartering Manager for Lauritzen Bulkers A/S

See all jobs

Colophon

ShippingWatch
Search

Sections

  • Carriers
  • Logistics
  • Regulation
  • Suppliers
  • Offshore
  • Ports
  • Sitemap
  • RSS feeds

Editor

Tomas Kristiansen

tk@shippingwatch.dk

Tel.: +45 3330 8360

Editor-in-chief

Anders Heering

Publisher

JP/Politiken Media Group Ltd

Advertising

annoncering@infowatch.dk

Tel.: +45 7077 7445

Advertising

Job Advertising

job@infowatch.dk

Tel.: +45 7077 7445

Jobs

Subscription

Try ShippingWatch or get an offer for a subscription meeting the exact needs of you or your company.

shippingwatch@infowatch.dk

Tel.: +45 7077 7445

Learn more about subscriptions here

Address

ShippingWatch

Rådhuspladsen 37

1785 Copenhagen K, Denmark

Tel.: +45 3330 8360

Guidelines

  • Privacy Policy

Copyright © ShippingWatch — All rights reserved

Microsoft is in the process of discontinuing Internet Explorer – and so are we.
For a better experience, we recommend using one of the following browsers.

Kind regards,
ShippingWatch

Google ChromeMozilla FirefoxMicrosoft Edge