The mechanical engineering company Wärtsilä, headquartered in Helsinki, Finland, is reducing its staff by 600 persons worldwide in its Ship Power unit. Some 160 of the redundancies will take place in Finland, with most of the people affected employed at the firm’s Vaasa machine works. Wärtsilä also employs over 300 people in Turku, most of which work in the company's Service business. A portion of the cutbacks will be realised as retirements.
In a stock exchange release dated July 17, the Wärtsilä Corporation said Wärtsilä’s Ship Power business, renamed Marine Solutions henceforth, will realign its organisation, operations and resources in response to the sluggish global marine market situation.
Wärtsilä seeks an annual savings of 40 million euros with the move. Currently, Wärtsilä Marine Solutions employs 7,217 people globally, meaning one tenth of their total personnel will be let go as a result of their streamlining efforts.
A good quarterly result nonetheless
Wärtsilä released its interim report for the first half of 2015 on the same day, and it showed that the corporation's order intake was up by two percent in the second quarter to 1.16 billion euros, while net sales were up by ten percent.
Second quarter growth was supported by an increase in service volumes and increased power plant deliveries in the firm’s two other units: Power Plants, now renamed Energy Solutions, which focuses on the energy market, and Services, which supports both markets.
Björn Rosengren, President and CEO of Wärtsilä Corporation, explains the new direction the company is taking:
“Environmental awareness and changing energy needs are increasingly steering investments in the markets in which we operate. The industry dynamics are changing, and we have fine-tuned our strategy accordingly. As we enter new market segments, such as Oil & Gas and LNG terminals, and acquire companies that bring new products to our portfolio, the scope of our offering becomes more than simply powering ships or building power plants. Therefore, we have decided to rename our Ship Power and Power Plants businesses Marine Solutions and Energy Solutions.”
Until now, the core products of Wärtsilä included large combustion engines used in cruise ships and ferries, with both shipyards and ship owners the main consumers.
Wärtsilä was an important Finnish shipbuilder from the 1930s to the late 1980s, building many of the world’s top cruise ferries and icebreakers. The shipyards have since been sold and are now owned by the German shipyard company Meyer Werft.