What’s new?? MHI-MME Activities June 2016, Athens © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. Comprehensive Product Portfolio of MHI-MME Water Jet Pumps © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 1 New Technologies and Products State of the Art UE Engine 6UEC50LSH-Eco-C2 Solution for Tier III regulation Low Pressure EGR System Air cooler Turbocharger EGR Scrubber Demister Pipe (EGR blower to Turbocharger) Overview of latest UEC Engine type UEC50LSH for MRT, CT, 34-60BC, etc. Overview of 6UEC45LSE-Eco-B2 with Low Pressure EGR System © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 2 New Technologies and Products Solution for CO2 reduction and fuel oil cost saving ORC (Organic Rankine Cycle) System Overview of ORC System on board (125kW Unit) © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 3 Licensees of MHI-MME UE engine ・HHI UE engine ・QMD ・YMD ・ZYHM MET Turbocharger ・HHI ・Doosan Engine ・STX Heavy Steering Gear, Deck Crane, Deck Machinery ・JMHI Main Turbine ・HHI Aux Boiler ・JHT Gen Turbine ・JQT Propeller ・CZZH Steering Gear ・Yoowon UE engine ・SBIC (BDD) UE engine ・Kobe Diesel ・Akasaka Diesel ・Ube Techno Eng Deck Crane ・SPP © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 4 Global Network MHIE(London, UK) MHIK (Busan, Korea) MHIA (LA, USA) MHI-MME (Tokyo, Nagasaki, Kobe) Consultant (Hamburg, Athens) MHI-AP (Singapore) MHI A/S Field Engineer Local Office (London / UK) (Singapore) (LA/US) (Shanghai / China) (Busan / Korea) Parts Depot Center (Hamburg, Germany) (Dubai, UAE) (Singapore) MHI-SH (Shanghai, China) MHI (A/S Service Station) Maintenance Partners (Belguim) World-wide Service Location (Authorized Repair Agencies) © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 5 What’s new?? Market status and Japanese Shipping/Shipbuilding Status June 2016, Athens © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. What to think ??? Headaches for global market players Stagnant Global Economy Low ClarkSea Index Depreciation of Assets Increases in Vessel Lay-ups Over Supply and Weak Ordering Over Building Capacity Environmental Regulation Timeline “The Thinker” (“Le Penseur”) © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 7 Global Shipping Market Overview World Fleet, Supply-Demand Balance © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 8 Global Shipbuilding status Historical Contract & Forecast (No. of vessels > 2000GT) Shipbuilding contracts in 2016 and 2017 is estimated to be in historical low level. (Less than 1,000 vessels in 2016) Contracting remains below the historical average throughout the forecast period. (less than 2,000 vessels p.a.) Above negative situation will be equally fair to all shipbuilding regions. Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 9 Global Shipbuilding status Historical Deliveries (No. of vessels > 2000GT by region) (Including Cruise, Offshore, Dredgers) 2011 Japan Korea China Others Total 2012 2013 2015 2014 487 467 395 392 401 21% Steady and stable, smallest decline 546 461 386 321 354 18% Loosing market, suffering financial problems 1426 1372 909 745 747 39% Loosing market, under allignment of over capa. 628 591 536 489 426 22% No expansion in Brazil, Vietnam, Turkey, India 3087 2891 2226 1947 100% 94% 72% 63% (100) (100) (100) (100) (96) (84) (96) (94) (81) (71) (64) (85) (80) (59) (52) (78) (82) (65) (52) (68) 1928 100% 62% Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 10 Global Shipbuilding status Historical Deliveries (No. of vessels > 2000GT by region) (Excluding Cruise, Offshore, Dredgers) 2011 Japan Korea China Others Total 2012 2013 2015 2014 478 457 381 372 387 27% Share jumps up in ocean going merchant vessels 514 448 374 285 332 23% Loosing market, suffering financial problems 1229 1205 743 558 574 39% Loosing market, under allignment of over capa. 357 318 217 180 164 11% Including Japanese & Korean overseas yards 2578 2428 1715 1395 100% 94% 67% 54% (100) (100) (100) (100) (96) (87) (98) (89) (80) (73) (60) (61) (78) (55) (45) (50) (81) (65) (47) (46) 1457 100% 57% Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 11 Global Shipbuilding status Deliveries vs New Orders (No. of vessels > 2000GT by region) Deliveries vs New Orders on 2015 (Including Cruise, Offshore, Dredgers) Deliveries New Orders Japan Korea China Others Total 401 21% 363 27% No change in the position as the most stable region. 354 18% 276 21% Accelerating consolidation and "entering court receivership". 747 39% 459 35% Concentrating to big state owned yards and accelerating consolidation. 426 22% 229 17% Still far away to find out the fourth new region as the leading shipbuilder. 1928 100% 1327 100% (100) (100) (100) (100) (100) (91) (78) (61) (54) (69) Quite low market level and expected to be worse in new orders of 2016 and 2017 Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 12 Steadiness of Japanese Shipbuilding Strong fundamentals Stable economy and trades(Import/Export) Stable shipowners, operators and investors Stable technology providers and suppliers (Established maritime cluster) Opportunities Ex-nuclear policy Less orders in offshore sectors Less orders of vessels in speculation © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 13 Steadiness of Japanese Shipbuilding Top Owners by Location (million GT) Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 14 Steadiness of Japanese Shipbuilding Top Investors by Location (billionUS$) Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 15 Steadiness of Japanese Shipbuilding Number of Yards to Win at least One Contract Source : Clarkson Research © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. 16 © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE © 2015 MITSUBISHI HEAVY INDUSTRIES MARINE MACHINERY & ENGINE CO., LTD. All Rights Reserved. MACHINERY & ENGINE CO., LTD. All Rights Reserved. 17 17