Meyer Turku reports loss-making year, starts layoff negotiations

Jan Meyer: "Our preparations have been for the future. Now unexpectedly that future has changed and we have to adjust

Finland’s Meyer Turku shipyard today disclosed financial results for 2019 that included a loss of EUR 107.9 million (about $117 million), compared with a profit of EUR 29 million in the prior year, and said that it is now looking to shed some 450 permanent jobs.

The shipyard started labor negotiations on temporary layoffs in the middle of March. Since then, it says, the impact of the corona virus pandemic on its cruise industry customers’ market situation is forcing it to change the scope of the negotiations. These negotiations will include the permanent layoff of 450 people with another 900 are affected by measures that include temporary layoffs of different lengths, work time adjustments and other arrangements. All personnel groups and levels are part of the negotiations.

“The corona pandemic has changed the situation unexpectedly and totally,” said CEO Jan Meyer. “We are facing the fact that the corona-caused pause in cruising requires us to stretch the order book. We are currently discussing the details with our customers. This new situation will force us to take painful adaptation measures to secure a sustainable future for Finnish cruise ship building and the network.”

“Our preparations have been for the future,” continued Meyer. “Now unexpectedly that future has changed and we have to adjust to that new future. Instead of a further ramp-up from one to two large ships delivered per year until 2023, the estimation is now that Turku shipyard will in the future build one large cruise ship per year and not further ramp-up.”

The exact changes to the building and delivery times of the seven ships in Meyer Turku order book (formerly reaching until 2025) are still under negotiations with the shipyard’s customers.

Reporting its 2019 financial figures, Meyer said that the loss for the financial year was mainly attributable to delays with the Costa Smeralda project due to difficulties with the shipyard’s substantial ramp-up in activity prior to the current situation and the LNG-fueled ship’s size and complexity. The losses are mainly related to delayed delivery of Costa Smeralda and reservations for the coming years.