Both shipyards belong to the parent company Genting Hong Kong, which is in serious financial difficulties. The Asian conglomerate acquired Lloyd-Werft in 2015 and MV Werften in Rostock, Wismar and Stralsund in 2016 in response to the then booming cruise market. But with the collapse of the industry as a result of the pandemic, the parent company got into severe turbulence that continues to this day. The future of MV Werften was therefore uncertain for a long time.
A total of 2,200 employees, 1,900 of them at MV Werften, are now facing an uncertain future. But it is also questionable how things will continue with the two cruise ships of the global class. The luxury liners were ordered for the Asian market in the middle of the industry peak of 2016 and built in Rostock and Wismar. With a capacity of 9,500 passengers and 2,500 crew members, a length of 342 meters and a height of 20 decks, they are considered superlative ships.
All possible amenities should also be offered, from a shopping mile to a large swimming area and a theme park. The interior areas should be equipped with artificial intelligence, face and voice recognition. But already in March 2020, the work was put on hold. The 1.5 billion euro “Global Dream” might only be built to 75 percent, the construction of the second ship was still in the early stages.
No agreement on the rescue package
Until the very end, one had hoped for a rescue. Before the bankruptcy petition was announced, there had been lengthy negotiations between the companies, the German federal government and the state of Mecklenburg-Western Pomerania regarding a rescue package. According to reports, the German federal government had repeatedly promised to provide around 600 million euros from the Economic Stabilization Fund (WSF).
The ship should be used as security for this. However, this would have required the owners to make a contribution of 60 million euros plus guarantees for federal funds. Apparently an agreement was reached with the Hong Kong parent company, but Genting is said to have only promised 30 million euros, according to NDR.
“Bitter news” for people and the region
The German economics minister Robert Habeck (Greens) told the dpa that “all levers have been pulled in order to avoid the bankruptcy of MV Werften and thus to save jobs. However, the owners have turned down our offer of help; the filing of bankruptcy is the result ”. After weeks of anxiety, this was “bitter news” for the shipyard’s employees and for the region, according to Habeck. The staff had recently received no wages and salaries – eight million euros are outstanding.
The industry representative IG Metall spoke of a “black day” for shipbuilding in Germany following the insolvency applications. The IG Metall demands the prefabricated building of the “Global Dream” in the bankruptcy. In addition, it is important to approach potential investors quickly and realign the shipyards.
Mecklenburg-Western Pomerania’s Prime Minister Manuela Schwesig (SPD) also hopes that the ship will be finished. Hopefully an insolvency administrator will be appointed for the shipbuilder as soon as possible. “We want to sound out with him, the insolvency administrator, whether there are ways that the construction of the ‘Global 1’ can continue even under the conditions of insolvency.” Completion might significantly improve the situation.
Omikron has doubts regarding the recovery in the industry
The cruise industry has been one of the hardest hit areas since the pandemic began. In the last two years, the shipping companies had to accept long compulsory breaks, but were able to catch up a little once more in 2021. At the beginning of the third year of the pandemic, people were confident, but the Omikron variant threatens to thwart the industry’s plans once more.
Cruise trips around the world have had to be canceled once more and once more in the last few weeks due to infections. Ocean cruisers from the companies Tui Cruises and Aida Cruises were affected. Brazil interrupted the cruise season due to many infections until the end of January. The US epidemic agency CDC also advised triple vaccinated people worldwide from cruising. The authority classified cruise ships in the highest category (“very high”) on a CoV risk scale of one to four.
The shipping companies, in turn, refer to the high security measures on board and try to lure with flexible booking conditions. However, the uncertainties and the potential risk of travel interruptions or quarantine on board should reduce the pleasure of booking considerably.
