Konecranes Vows to Improve Efficiency, Reduce Costs

MarineLink.com
Wednesday, July 24, 2013

As preliminarily communicated in the stock exchange release on June 19, 2013, Konecranes’ profitability development has been unsatisfactory amid the current challenging business environment, the company said in a news release. In addition, the economic environment remains uncertain, and Konecranes said it will prepare accordingly. The company is planning new measures to reduce annual cost base by EUR 30 million by the end of 2014 of which roughly two-thirds relates to the Business Area Equipment and one-third to the Business Area Service. Furthermore, Konecranes is planning new actions to reach savings in variable costs.


The considered key actions are:

  •  consolidation and transfer of production between sites
  •  optimization and productivity improvements in the manufacturing processes
  •  consolidation of and efficiency improvements in administration and support functions
  •  consolidation of sales units to cover larger areas
  •  improving productivity and restructuring of underperforming operations


The total cash-based restructuring costs are estimated at maximum EUR 20 million for the years 2013 to 2014. In addition, the company expects to book non cash-based restructuring costs not exceeding EUR 20 million. The considered actions are estimated to impact maximum 600 people through redundancies, temporary lay-offs and early retirement. Konecranes employs approximately 12,000 persons currently.


“The world is changing rapidly and we cannot expect the world economy to provide a lot help to our growth. We also expect the tough pricing environment to continue. Our overall cost is too high for our volume outlook, and, we plan to adjust our cost base and the size of our organization to market realities. In addition to fixed cost reduction, we are preparing several initiatives to rationalize our supply chain, to push down our variable costs. There is potential for savings in our non-personnel related spending as well, but, unfortunately, effects to personnel cannot be avoided,” says Pekka Lundmark, President and CEO.


“We will improve our cost efficiency, but we also continue our three major initiatives for future competitiveness. First, we are introducing new technologies that enable real-time visibility to the condition and performance of the lifting devices and machine tools that we service. Second, we develop a totally new product family mainly for emerging markets. Third, we rebuild our fragmented IT systems to create real-time visibility to customer demand, field service, supply chain, and financials. All of these three strategic initiatives require new skills. Our competence development will therefore be of key importance in all of them,” he continues.


Further information will be provided during the course of the cost savings program, the company added.

 

Maritime Reporter June 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

ClassNK Holds LNG Fuel Technologies Seminars

ClassNk held LNG-Fuelled Vessel Technologies seminars in Shanghai and Singapore on 22 July and 24, July 2014, respectively. With the industry looking to adopt

USCG Change of Command in Galveston

A Coast Guard lieutenant commander and graduate of Hastings High School in Houston, took command of Maritime Safety and Security Team Galveston during a ceremony in Galveston Thursday.

Miller Rejoins TITAN as Salvage Master

Captain Stuart Miller has rejoined Crowley Maritime Corporation’s TITAN Salvage operations team as salvage master, bringing with him over 30 years of worldwide,

Technology

ClassNK Holds LNG Fuel Technologies Seminars

ClassNk held LNG-Fuelled Vessel Technologies seminars in Shanghai and Singapore on 22 July and 24, July 2014, respectively. With the industry looking to adopt

Eliminating Cat Fines to Marine Diesel Engines

One can assume that P&I Clubs and shipowners would be very interested in preventing catastrophic Cat Fines damage to diesel engines. Cat Fines have been damaging

Gulf Island Fab Sign Bechtel Offshore Cooperation Agreement

Gulf Island Fabrication, Inc. says it has signed a cooperative agreement with Bechtel Oil, Gas, and Chemicals, Inc. to work together to pursue opportunities for offshore projects for the U.

Finance

Canal Project Slows Panama Economy Growth

Panama's economy expanded in May at its slowest pace since 2009 as major public works projects, including an expansion of the Panama Canal, slowed or wrapped up,

Gas Prices Help Offset Statoil's Output Drop

Statoil's second quarter 2014 net operating income was NOK 32 billion, a decrease of NOK 2.3 billion compared to the second quarter of 2013. Adjusted earnings were NOK 32.

Asia VLCC Rates Could Nudge Higher on Activity

Rates for very large crude carriers (VLCCs) on key Asian freight routes could hold steady or gain next week as charterers seek to complete their vessel chartering

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Offshore Oil Pipelines Pod Propulsion Ship Electronics Ship Repair Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1037 sec (10 req/sec)