Kalmar hit by ‘slower decision making’

This aside, Cargotec’s CEO Mika Vehviläinen said that Kalmar’s long-term market potential is still strong despite there being no big project orders in the pipeline.

“Container and cargo handling equipment and related services as well as port automation solutions are typically big investment decisions. Our incoming order flow is therefore not even but fluctuates from a quarter to another. Many issues affect our customers’ decision like the political instability, level of oil price, vessel size development, competitive situation and level of world trade,” he told Port Strategy.

And when asked if the slow down in orders was worrying for business, the answer was “not at all”.

“At the moment, Kalmar’s order book is up 5% from the end of 2015, and I do not see that worrying at all. The need for investments is there, the question mainly is that when the increasing trust in investments can be seen in our end, Mr Vehviläinen told PS.

Despite this, the challenging market situation is also being felt by MacGregor with the global merchant ship market facing overcapacity and new ship orders being at an exceptionally low level. But Cargotec is taking measures to lower costs.

Happier news came in the form of Hiab’s strong development which continued during the third quarter with core business orders at a good level and profitability improving on the previous year.

Mr Vehviläinen said: “Our strategic focus areas are services, digitalisation and leadership development. In services we see tremendous business potential that we need to grasp with increased determination.”

He added that Cargotec has increased its efforts in this area. For example, Hiab opened a spare parts web shop in September, MacGregor strengthened its spare parts delivery cooperation relationships in Asia and Kalmar has initiated new measures to speed up the growth in services.

The other focus he said is on digitalisation, where Cargotec is continuing to work on IoT1 Cloud-based solutions with its customers focusing on automation effectiveness and proactive maintenance.