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"None of the 100 billion for the Bundeswehr has reached us yet"

Rino Brugge trudges in his safety shoes past the almost 430 meter long dry dock.

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"None of the 100 billion for the Bundeswehr has reached us yet"

Rino Brugge trudges in his safety shoes past the almost 430 meter long dry dock. Cold rain comes down from the Baltic Sea into the Kiel Fjord, the wind makes the long walk uncomfortable. The boss of the shipyard German Naval Yards explains the upcoming work on the supply ship "Berlin" of the German Navy.

Then the Dutchman opens the door to the large Hall 11 and shows the steel work on the forecastle of frigate 130. Only a few shipyard workers can be seen. In general, the huge site of GNY, as the abbreviation goes, seems deserted. Brugge is the governor in Germany for Iskandar Safa, a businessman who was born in Beirut, Lebanon and lives in France. He owns naval shipyards in France, Great Britain and in Kiel.

The owner's original desire to turn it into a leading European naval shipbuilder has not materialized to this day. In his first interview as shipyard boss, Brugge calls for an “industrial policy for naval shipbuilding” in Germany.

WORLD: Mr. Brugge, we are on the site of the former largest German naval shipbuilder Howaldtswerke Deutsche Werft and today's naval shipyard German Naval Yards. The naval ship “Berlin” can be seen in the dry dock directly in front of your office window. Is this your only current assignment?

Rino Brugge: That's not our only job, but it's the biggest at the moment. We will be working on the German Navy's supply ship for almost a year and will completely overhaul it. In addition, we are currently manufacturing the steel construction of the bow of the Corvette 130 in Hall 11. We are one of the few large shipyards in naval shipbuilding in Germany and work closely with other shipyard groups. In the next few years, the steel construction for the new frigate 126, which is being developed by Damen Naval in the Netherlands and largely built in Germany, will be added. That will keep us busy until the end of the decade.

WORLD: Shouldn't there be new orders for military ships from the federal government's special fund for the Bundeswehr?

Brugge: We have not received anything from the EUR 100 billion program for the Bundeswehr. We actively sought and approached the Department of Defense. My impression is that before the special fund and the proclamation of a turning point, more naval shipbuilding projects were being planned by the Bundeswehr than is the case now.

For example, the third lot for five more Corvettes 130, which are to be built by a consortium, is still outstanding. I have hope that the new Secretary of Defense will bring more movement to the awarding of contracts. It would be good for our planning security if new German Navy projects were not postponed too far into the future.

WORLD: Your competitors Lürssen Naval and ThyssenKrupp Marine Systems will benefit most from this. Since your shipyard didn't get the billion-euro order for the 126 frigate and will only do some steel work for the ships, German Naval Yards seems to be out of the running for the navy in Germany. The frigate is built by Damen Naval in the Netherlands.

Brugge: In Germany there is very close cooperation in naval shipbuilding and we are part of it. It would be good if a unit would emerge from the patchwork quilt of the German naval shipyards. In my view, we need to talk about consolidation. However, this must be politically desired and also controlled by politics. I consider it a prerequisite of a strategic security policy to consolidate naval shipbuilding in Germany. If desired, we will participate.

WORLD: The submarine shipyard TKMS wants to apply for a new design for the successor ship Frigate 127 and build surface ships again. The ThyssenKrupp subsidiary bought the former MV shipyard in Wismar especially for this purpose. Not there again?

Brugge: This new frigate is a very long-term project and only at an early stage. And as far as TKMS is concerned: I do not rule out that German Naval Yards will also apply for it. In the end, no shipyard will be able to build such a program on its own.

WORLD: German Naval Yards currently has just 400 employees, some of whom are on short-time work. How do you intend to bring work to this huge shipyard site?

Brugge: The short-time work only affects a very small part of the workforce and will be phased out in the summer. We are expected to receive the order as general contractor for equipping the supply ship "Berlin" with a marine rescue center. That is a mid double-digit million euro amount. We are part of the international shipyard group CMN Naval made up of CMN Cherbourg in France, Isherwoods in the UK and German Naval Yards. We receive orders from this group, for example for the steel construction of small naval ships. I expect us to have good capacity utilization by the end of the decade. As far as the number of employees is concerned, I expect to hire new people next year.

WORLD: The CMN Naval shipyard group is owned by Iskandar Safa, a Lebanese-born businessman. Is that a reason why your shipyard has not been able to take on orders?

Brugge: Our shareholder supports us on our way and in the cooperation with other shipyards in Germany. Recently there have been no orders for German naval shipyards. The frigate 126 went to the Netherlands. This should probably not be repeated in further tenders by the German Navy, because such ships will no longer have to be tendered Europe-wide in the future.

That's why I think consolidation in Germany is important. The country stands for the construction of high-quality naval ships. For your own safety, you need an industrial policy for naval shipbuilding. It's different in France or Italy with the state shipyards there. This puts the German naval shipyards at a disadvantage when it comes to orders from abroad. We are in competition with each other instead of with foreign shipyard groups.

WORLD: Other shipyards promise business through the expansion of wind power at sea. Platforms for converters, for example, will be required on a larger scale in the coming years. Is that a beacon of hope for you?

Brugge: High-quality platforms for the energy transition can be a business if it involves sufficient quantities. For this, too, we need a German industrial policy. Cheap offers from Asia should not be the solution for orders as part of the German energy transition. Our dependence on China is already high.

WORLD: Your shipyard has worked at a loss in recent years. What's next?

Brugge: In recent years, like other companies, we have had to accept losses due to Corona. This year we will return to positive territory. This is likely to remain the case until the end of the decade. I expect an increase in sales for 2023.

"Everything on shares" is the daily stock exchange shot from the WELT business editorial team. Every morning from 5 a.m. with the financial journalists from WELT. For stock market experts and beginners. Subscribe to the podcast on Spotify, Apple Podcast, Amazon Music and Deezer. Or directly via RSS feed.

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