The Holeby operation employs around 600 people and generates a turnover of around 900 million DKr (around 17,000 million Yen). About 700 million DKr (13,000 million Yen), of sales relates to marine business. The Frederikshavn plant employs around 500 people.
The prospects for revenues over the next few years look to be very encouraging given the high levels of orders which will bring high levels of royalties from licencees in due course.
1.3 Operating Costs and Procurement Strategy
With many of its engines designs built under licence, the question of procurement does not apply directly to MAN as it is a matter for their licencees. In Denmark, at both Frederiksahavn and Holeby key components are made in-house and other items bought in from suppliers. Functions performed at the Augsburg plant include pattern and mould-making; casting products (grey and nodular cast iron); welded components; precision machining of components; precision machining of highly-loaded components; heat treatment; assemblies for general mechanical engineering. These different approaches reflect the different markets served by the two factories.
1.4 Competition Aspects
The figures below do not take into account any increases in market shares brought about by the acquisition of Alstom UK.
MAN B&W claims a 65 per cent share of the market for two-stroke marine main engines, making it a clear world market leader. In respect of four-stroke marine main engines for ships larger than 2,000 gt it claims a market share of 24 per cent and for marine auxiliary units a market share of 33 per cent.
Over the past 12 months the company has sold around 300 two stroke engines. The vast majority of these were produced by licensees. Four-stroke engines are supplied direct to customers in Europe and through licensees elsewhere. Normally the company produces between 10-15 four-stroke engines each year but high levels of success, particularly in Turkey, Germany and the Netherlands means that they currently have orders for 22 engines.
In Japan, the company estimates a market share in terms of orders for two-stroke engines during 1998/99 of 62 per cent. Japan is seen as a very important market given the strengths of Japanese shipyards in producing medium-sized ships and VLCC tankers, many of which are powered by two-stroke engines. This has been demonstrated by the success of licensee-built MC-C engines.
