Germany pledges to save troubled Meyer Werft shipyard

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The German government is working on a rescue plan for troubled luxury shipbuilder Meyer Werft, Chancellor Olaf Scholz said on Thursday during a visit to the company.

“The government will play its part in finding a solution,” Scholz told workers at the site in the northern city of Papenburg, promising that the details of the agreement would be finalized soon.

Founded in 1795, Meyer Werft employs 3,300 people in Papenburg and is one of the largest shipyards in the world, focusing on the construction of cruise ships.

But the company has struggled with rising energy and raw material costs and needs about 2.7 billion euros ($3 billion) to fulfill its order book through 2027, according to German media reports.

Scholz described the company as “an industrial piece for Germany” and said it was “important that we can continue to build such ships in Germany in large numbers at a high level”.

The company presented a restructuring plan at the end of July and rumors have been circulating for some time that Berlin would be willing to step in to keep it afloat.

According to German media, the rescue agreement will involve the temporary nationalization of the company.

Earlier this month, Meyer Werft said it had landed the largest order in its history as it was ordered to build four new Disney cruise ships by 2031.

Many shipping companies have struggled in recent years as the coronavirus pandemic put the brakes on the cruise industry and then the war in Ukraine drove up energy and material costs.

In July 2022, the German state acquired the bankrupt MV Werften shipyards in Rostock, northeastern Germany.

Germany has also come to the rescue of other travel companies during the pandemic, such as airline Lufthansa and tour operator TUI.

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