Mecklenburg-Vorpommern District

Germany: MV Werften cuts 1,200 jobs in shipyards


In a two-minute video, MV Werften (shipyard) CEO Peter Fetten informed the workforce at the three shipyards in Wismar, Warnemünde and Stralsund that more than a third of the 3,000 jobs are reportedly affected by a “program restructuring. About 1,200 jobs are at risk – a blow to the workforce, as the shipyard industry is one of the region’s largest employers.

MV Werften GmbH shipyards in Rostock, Mecklenburg-Western Pomerania (Credit: Sebastian Krauleidis via Wikimedia Commons)

The future of the remaining workforce is also at stake as the owner of the shipyard is in financial difficulty. All three MV shipyards are owned by investment holding company Genting Hong Kong Ltd., which is primarily engaged in cruise ship businesses, as well as resort hotels, casinos, tourism events, aviation, and shipyards. The main shareholder and chairman of the board is billionaire Lim Kok Thay, who also operates large palm oil plantations in Malaysia.

In the former East Germany, the Baltic shipyards employed more than 50,000 workers in the production of cargo ships for sea and river transport. After reunification, this business collapsed and tens of thousands of people lost their jobs. Ownership of shipyards changed several times in the years that followed, and the workforce fell to less than 1,500 workers.

When cruise ships surged in the decade leading up to 2020 and passenger numbers doubled internationally to 30 million, all cruise ship yards were operating at full capacity. This is what motivated Genting Hong Kong to embark on shipbuilding in 2017 with the takeover of MV Shipyards. Genting has pledged orders totaling 3.5 billion euros for several river cruise ships, luxury icebreaker ships for cruises to the Arctic Ocean and two giant cruise ships.

As a result of the coronavirus pandemic, the cruise has practically come to a halt and with it the manufacturing activity of these ships. The cruise ship Global One has yet to be completed in Wismar, and the luxury expedition yacht Crystal Endeavor in Stralsund, but work on a third ship, Global II in Rostock-Warnemünde, has been terminated and a demolition company is already searched.

As in other industries, workers are burdened with any obstacle to profit. This situation has been exacerbated by the pandemic. Instead of the owners taking the loss, the shipyard group asked the state government of Mecklenburg-Vorpommern and the German government for state aid to cover loan payments and other liabilities. In October, the state government accepted an early partial disbursement of € 193 million from the German government’s economic stabilization fund.

IG Metall has called this a “positive signal” and is hoping to secure additional funds. A loan totaling 570 million euros has been requested. So far, employment has been secured until the end of March 2021, but with the company threatened with insolvency, the future outlook is uncertain.

The union has been discussing a plan to deal with the crisis since last week. As in other industries, this means that IG Metall has already accepted the reduction of 1,200 jobs. Reductions in wages and working hours are under discussion.

IG Metall Küste district manager Daniel Friedrich called for new projects in offshore wind farms or naval contracts. Stefan Schad, managing director of IG Metall Rostock and Schwerin and union representative of MV Werften, said in a press release that the union was pushing for a “well-equipped transfer companyâ€. “As many employees as possible†must be retained, he said.

As early as last November, IG Metall Küste announced that the trade union, the employers’ association of Nordmetall and the management of MV Werften, as well as the general works council and the state ministries of finance and economy, agreed that, given the current workload, “significant staff adjustments and cost savings” would be required. The representatives of the workers, the company and the government agreed on “close and constructive cooperationâ€.

Like the many transfer companies that IG Metall had already established in other industries, this one will only transfer workers to lower paying jobs, precarious jobs or unemployment. The Stralsund shipyard, which has around 650 employees, may even be completely closed. Orders in progress are only sufficient to maintain employment until June.

The entire shipbuilding industry is in crisis. According to a survey by consultancy firm Pricewaterhouse Coopers, 83% of companies surveyed expect there to be many bankruptcies in the industry this year. Already last year, the German shipyards in Kiel received federal subsidies. Thyssen Krupp Marine Systems is also in crisis. In September 2020, the union announced that more than a third of Germany’s 18,000 shipyard jobs were at serious risk.

The pandemic reveals the brutality of capitalism: As luxury cruise ships for the rich are scrapped, refugees from Africa capsize in their inflatable boats unfit for navigation in the Mediterranean and refugees from Syria freeze in camps in Greek mass.

Instead of defending every job as a matter of principle, unions again prove to be the sidekicks of the owners of capital, striving to create the destruction of jobs and workers’ livelihoods in a way that prevents rebellion.

It is high time that workers organize themselves independently of these bureaucratic apparatuses and join action committees with their colleagues in industry and internationally to defend their jobs. The WSWS and the Socialist Equality Party fully support them in this endeavor.