Finland’s Wärtsilä’s Ship Power business, today renamed Marine Solutions, has said it plans to realign its organisation, operations and resources in response to the sluggish global marine market situation.
These plans, Wärtsilä says, will affect personnel in all functions of Wärtsilä Marine Solutions’ global operations. Six hundred employees will lose their job, of which some 160 will be in Finland. A portion of the reductions will be realised through retirements, the company said. Currently, Wärtsilä Marine Solutions employs 7,217 people globally.
In taking these measures, Wärtsilä has said it seeks annual savings in the region of EUR 40 million. The effect of the savings will materialise gradually beginning from the third quarter of 2015, and will take full effect by the end of 2016. The non-recurring costs related to the restructuring measures will be approximately EUR 25-30 million.
“The marine industry has been slow in recovering from the global economic crisis and new shipbuilding contracting is weak. At the same time, the offshore oil & gas industry has been adversely affected by lower oil prices. In addition, there are risks related to vessel owners negotiating extensions to existing delivery contracts. The combined impact of these developments has created a challenging market situation for the entire marine sector.
These unfortunate capacity adjustments have to be made in this current environment of low demand in order for us to maintain our competitive position in the global market. Despite streamlining the organisation, our commitment to our customers remains absolutely solid,” says Jaakko Eskola, President, Marine Solutions, Senior Executive Vice President, Wärtsilä Corporation.
Further in its release, the company said that the realignment plans were aimed at adjusting Wärtsilä’s Marine Solutions business to be able to efficiently respond to the needs of its various customer segments. It added that the effect of the adjustments would be specified when the consultation processes are initiated in the affected countries according to local practices and legislation.