Sweden: Assembly Liners

Among the world’s ailing industries, few are hurting worse than shipbuilding. The demand for shipping that was whetted by the new Persian Gulf oilfields faded abruptly in 1959, when the U.S. put quotas on oil imports. Result: a worldwide glut of cargo space. To glean what new orders there are, the big U.S. and European shipyards have had to slice deeply into their profits to come up with low bids, but they are still losing ground to the front-running, highly efficient and low-paying Japanese.

Yet, while other Europeans despair of ever winning back their lost business, Sweden’s 700-year-old shipbuilding industry keeps right on expanding. Since 1950, new tonnage from its shipyards has nearly doubled (to 742,068 tons). Today Sweden ranks fourth among shipbuilding nations (behind Japan, 1,799,342 tons; Britain, 1,191,758; West Germany, 962,407). While other European shipbuilders dolefully expect things to get worse, the Swedes look confidently for a new record of more than 800,000 tons in 1962—and they boast a three-year backlog.

Europe’s Biggest. This week the Kockums yard in Malmö will deliver the largest ship ever built in Scandinavia, the tanker Esso Lancashire (81,150 deadweight tons). At the Eriksberg yard in Göteborg, workers are laying the keel for the largest ship ever built in Europe, a 92,750-ton Socony Mobil tanker.

What makes the Swedish record particularly notable is that next to the U.S., Sweden pays the highest wages in the world. Its shipyards pay skilled workers $1.50 an hour, nearly twice the rate for Japanese hands, and get no government subsidies. How have the Swedes done it?

By ruthless, intensive automation, which is backed wholeheartedly by a farsighted shipyard workers’ union. Result: Swedish shipbuilders figure that they use only half as many workers as the Japanese on many jobs.

Stern First. When the new, $36,000,000 Arendal yard of the Götaverken Ship Building Co. goes into production near Göteborg next spring, it will be the world’s most fully automated shipyard, capable of building colossal, 140,000-ton ships on the industry’s first real assembly line. It throws out the old method of building ships on stationary ways from the keel up. Instead, ships will emerge from a giant assembly shed stern first in 45-ft. sections; as they move down the ways, everything from deckplates to cabin carpets will be installed, so that the ship does not have to spend months in a fitting dock after launching. As the bow of one is being completed, the stern of the next will start down the line. With a 40,000-ton tanker, the yard will halve the normal 40-week period between keel-laying and sea trials.

Like other shipbuilders, the Swedes are not happy with their current earnings, and many of the contracts they are taking on now will show them no real gains. But from the hard lessons they are learning in the lean years, they will be ready to ride the next big wave of world shipbuilding to solid profits. In the meantime, says Götaverken’s Managing Director Hilding Nielsen: “We have to build big if we are to survive.”