BERLIN (AP) — The German government will rescue a major German shipyard that has a solid order book for new cruise ships but has run into financial trouble, Chancellor Olaf Scholz said Thursday.
Meyer Werft employs more than 3,000 people in Papenburg on the Ems River in northwestern Germany, near the Dutch border. The company has built 58 cruise ships to date, according to its website.
Customers include Disney Cruise Line, which earlier this month announced a deal to build four more ships. Even before that, the company said it had full order books through 2028.
However, the company has run into financial trouble after having to pay a large portion of the costs of building cruise ships up front. Scholz cited the fallout from the COVID-19 pandemic as a factor in the trouble, saying the company is “systematically relevant” to shipbuilding in Germany, Europe’s largest economy.
Scholz, who traveled to Papenburg to speak at a staff meeting, praised the company’s ships as “state of the art” and told employees that “what you are building here are actually small cities,” according to comments released by his office. He said that 17,000 jobs across Germany depend in some way on Meyer Werft.
He said that “great progress” had been made in negotiations with management, banks and the state of Lower Saxony, but that “some detailed work still needs to be done”.
The federal government “will do its part to help solve the problem, and I clearly expect all other participants to join in,” he said.
Scholz did not provide details about the proposed rescue operation. German media reported that the planned solution would involve the federal and state governments temporarily taking a stake in the company and financing a capital increase for the shipyard.
