Shipbuilding German Bundestag gives green light for investment in Meyer Werft

The Budget Committee of the German Bundestag has cleared the way for the billion-euro rescue of Meyer Werft. The Papenburg-based company is known for its cruise ships, but is facing a financial crisis that threatens its very existence.

According to the German press agency Deutsche Presse-Agentur, the budget ministers in Berlin agreed to allow the federal government to contribute the planned 200 million euros to the stabilization. A further 200 million euros are to come from the German state of Lower Saxony, but the budget committee there still has to give the green light. In addition, both the federal government and the state want to grant guarantees of around one billion euros each to secure loans.

Financing gap of almost 2.8 billion euros

"By stabilizing the shipyard financially for a limited period of time, we are securing the future of the shipyard and thousands of jobs," emphasized SPD budget Dennis Rohde. Meyer Werft is an important engine for the maritime industry and an employer for around 3,500 employees as well as well over 10,000 employees in the supply industry.

The federal and state governments are now jointly responsible for getting the company out of financial difficulties. Meyer Werft has to raise almost 2.8 billion euros by the end of 2027 to finance the construction of new ships. The agreements must be reached by September 15.

The background to the crisis is not a lack of orders, but contracts for new ships that were concluded before the coronavirus pandemic and do not provide for any adjustment to the sharp rise in energy and raw material prices since then. In addition, 80% of the construction price in the industry is usually only paid when the ship is delivered - the shipyard therefore has to finance the construction with loans.

Geostrategically important shipyard

According to dpa information from parliamentary circles, the federal government is also pursuing a strategic interest with the rescue: Should the geopolitical situation worsen, the shipyard facilities could also be used for the navy and take on a significant role in military shipbuilding, they said. In economic terms, however, the federal government expects that the shipyard will still record losses in 2025 and 2026, even if the restructuring plan is implemented.

There is no fixed exit date for the state participation. However, there is talk from both Berlin and Hanover that the shipyard should not remain in public hands in the long term.

SDA