Marine Log - December 2007 - (Page 24)

Olli Isotalo President, The MacGREGOR Group The booming shipping market is providing great opportunities for companies that have a flexible business model, such as MacGREGOR. Thanks to this flexibility, as soon as increased production capacity and component sourcing were needed, we were ready to respond. While taking advantage of the situation we can also make sure that we have the capacity to fulfill our obligations, and provide our customers with the level of support and service that they have come to expect from MacGREGOR. The market is very much based on supply and demand. Limitations in supply cause prices throughout the chain to increase. This obviously applies to MacGREGOR and its sub-suppliers. Our answer is a business model built on the “partner” concept. We are not limited by the capacity of our own prduction facilites but instead we have a wide network of production partners capable of giving us the flexibility needed ina cyclical market. This network also means that we can be sure that the equipment produced will have a consistently high MacGREGOR quality, and be delivered on time, even in periods of great demand. Our production partnerships are long-term relationships, in which both parties fully understand each other’s business, working methods and culture. In some cases we have designed a partner’s new factory. So peak demand does not force us to subcontract production work out to the open market—we have prepared for these circustances, and so have our partners. Which is good for our customers, and for our business. For many years MacGREGOR’s strategy has been to do what it does best—design, engineer and innovate—and then manufacture the resulting products at places where quality and punctuality can be guaranteed. As shipbuilding migrated to Asia, and European shipbuilding declined, MacGREGOR has followed the business by increaing its activities in Asia. We now have production Partners in China, Korea, Japan and Vietnam as well as in Poland and Croatia. There is a need to be more flexible now than ever before—on a global basis. Take the changes in Chinese VAT regulations as an example. Overnight this is creating an increased cost structure for Chinese manufactured products, adding to the impact caused by more expensive raw materials. These events need to be dealt with straight away, while at the same time we continue to serve our customers efficiently and effectively. A boom can test a company’s strength as much as the lean times do. MacGREGOR has experienced plenty of peaks and troughs in shipping sector cycles over the past 70 years. We have learned that flexibility is the answer—both for our own business and for our customers’ businesses. Whatever the market conditions, we can provide top quality, innovative cargo handling systems that will work when needed, at a budgeted through-life cost. We are strong enough to guarantee that. Henrik O. Madsen of these mechanisms is to initiate projects that lead to additional emissions reductions of CO2 and other greenhouse gases. The mechanisms provide both buyer and seller with economic incentives. In this manner the mechanism of quota trading helps to reduce emissions at the lowest possible cost. In order to make the Kyoto trading mechanisms work, the world needs competent, credible and independent organizations to both validate the realism in the projects and verify the actual emissions reductions. The quota trading mechanism is dependent on the trust and confidence we are able to bring into the system. DNV is engaged by the United Nations Framework Convention on Climate Change (UNFCCC) in validation, verification and certification of many of the now more that 2,100 Clean Development Mechanism projects as well as in a number of Joint Implementation President and CEO, DNV projects in different stages of their development. We can confirm that the strict framework defined by the UN has been an important mechanism to secure the trust in the emissions reduction certificates. The certicates are successfully introduced as tradable assets in the market place. Another aspect we have observed is that the present projects are based on existing technology. The mechanisms therefore lead to a global synchronizing of the use of available technology—as intended. However, new technology also needs to be encouraged. I am a firm believer that the most effective way to address our environmental challenges is by developing new and cleaner technologies. Mechanisms to support the development and introduction of new technology must be found. We need a dramatic increase in our research and development of environmentally friendly technology. www.marinelog.com A powerful tool for sustainable development is to creatively use market mechanisms. Idealism is valued, but market mechanisms are more effective tools for real and sustainable change—in particular when they can create a win-win situation. This may well be by creating markets where demand does not yet exist. The Kyoto Protocol—with its mechanism for quota trading—is a good example for how business and market incentives are built into an international ambition for protecting the environment. The objective 24 MARINE LOG DECEMBER 2007 http://www.marinelog.com

Table of Contents Feed for the Digital Edition of Marine Log - December 2007

Marine Log - December 2007 Contents Editorial Second Thoughts Update Inside Washington Warning: Shipbuilding Over-Supply by 2011 Steely Resolve: Cutting Injuries What’s on Your Mind? Newsmakers Tech News Contracts Events InfoDirect Website Directory ML Marketplace Last Word

Marine Log - December 2007

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