Port Workers Fear Broken Promises Will Ship Come in for Bankrupt German Company?

The Wadan shipyards are some of the best in the world as well as one of the biggest employers in eastern Germany. But after a new owner failed to deliver promised orders, the yards became insolvent. Now workers and their families are hoping a new Russian investor will keep his word.

By Steffen Eggebrecht

Leaves of white paint drift softly off the rusty gate. Behind it, a large blue crane juts into the skyline -- if you happen to be in the suburb of Warnemünde in the German Baltic Sea port city of Rostock, you can't miss it. A few months ago the crane was still heaving parts of ships, weighing over 600 tons, onto the dock. Hundreds of construction workers, metal workers and welders streamed through the shipyard's gate daily and the racket made by construction that was going on belonged to this area like the smell of salt belongs to the sea.

In recent weeks, though, the place has fallen strangely silent. There are no sirens alerting workers to a change of shift, not even the cry of a lonely gull. The 85 hectare area belonging to the Wadan Shipyards -- once Germany's fifth-largest -- is quiet, the last shift has ended. For Norbert Weidt, that shift ended after 36 years on the job at Wadan.

The 53-year-old has short, salt and pepper hair and he almost sinks into the brown leather chair he is occupying, as he recounts his life working in the shipyards of Rostock. Like many inhabitants of the German state of Mecklenburg-Western Pomerania, once part of East Germany, he has a distinctive accent, accentuating his vowels and drawing his sentences out. There is a wooden carving hanging in his living room: around three dozen golden fish on a green background. It is the only maritime symbol he has; there are no other souvenirs of his time at the shipyards.

Since early June the Wadan shipyards in Rostock and Wismar have been insolvent. Shipbuilding was the region's mainstay for decades. Now thousands of workers and hundreds of suppliers are waiting for a decision. They have their hopes set on the new Russian investor, Igor Yusufov, who bought the yards at the end of August.

Three Generations Shipbuilders

There's a lot riding on this for the Weidt family. Three generations of Weidts work here as does a brother-in-law and an uncle. In the 1950s, Weidt's father Karl-Ludwig worked on the fire-service boats that were responsible for the shipyards. Later on the yards had their own fire service. Weidt himself started out as a 17-year-old apprentice. As a maintenance engineer, he's looked after the machinery and other equipment at the yards. "The work fulfilled me every day," Weidt says.

And he got his son Paul into shipyard life early on too. Paul is now 22 years old and training to be a plant mechanic. One August afternoon in 2001 in particular sticks in his head. The drilling rig, Stena Don, was being brought ashore. The red colossus, which stretched at least a 100 meters into the sky, required tens of thousands of meters of welding rods and around 1.7 million hours of work. Thousands of curious onlookers lined the piers along the Warnow River as the rig arrived.

For most of the workers the shipyard is more than a job. It's a friendly, egalitarian place -- apprentices greet their teachers informally. After the shift everyone heads for the obligatory after-work beer. They celebrate the arrival of big ships together with their families or they meet up at home games the local football team, Hansa Rostock.

Nobody Cares about Quality Anymore

The workers here are proud of the yards and the shipbuilding capabilities which have developed since German reunification in 1990. The account books were full and the two yards were some of the most modern and most efficient in the world. The workforce is well qualified and the training is considered some of the best in Germany. Pride is taken in the yard's accomplishments, the shipbuilding traditions and the customary local virtues involved. Sure, the Asian ship builders do their work more quickly and at lower prices. "But our quality is best," Weidt boasts.

Since the crisis in international trade, however, suddenly nobody seems to care about that quality anymore. If there is no trade, then you don't need the ships to transport the goods -- which is why there has hardly been any production at the shipyards since June. As a result a lot of the employees took their annual holidays or worked shorter hours.

It was only one year ago that the shipyard last changed hands. Wadam's most recent co-owner, Russian investor Andrey Burlakov, who served as the company's most recent chairman, offered the prospect of around €2.5 billion worth of orders. "We are worried we don't have enough staff," Burlakov boasted at the time. But those orders were not delivered by the time the economic crisis hit. Even today, Weidt and his colleagues disapprove of Burlakov. "He promised us the moon and acted as though he could fly us all there," Weidt said. You barely hear Burlakov's name around here, mostly he is referred to as "the Russian."

Brand New Ships Marooned In Dry Dock

But the workers are also aware that their situation depends not just upon the yard's owners but also upon the worldwide recession. There are complete ships left sitting at both yards, marooned there because shipping companies couldn't afford to pay their bills. Some of those firms wanted to negotiate, others wanted to withdraw whole orders. Despite the crisis we still want to be fairly paid, Weidt argues. He says the pressure being put on for lower prices is unfair and that those companies just want to pass their costs along.

But decisions regarding the continued existence of the shipyards have long since passed out of the staff's hands. In Yusufov, it looked as though the provisional insolvency administrator, Marc Odebrecht, had found a reputable investor. Yusufov formerly served as Russia's energy minister and sits on the board of directors of the largest Russian energy utlity, Gazprom. He took over the shipyards in Rostock and Wismar for €40.5 million and it is thought that, as a result, around half of the 2,500 jobs there will remain.

Promises Sound All Too Familiar

The shipyard staff is inclined to credit Yusufov with more competence than Burlakov. Still, the rhetoric that has been used until now has made them mistrustful. It sounds all too familiar. Yusufov's son, Vitaly, who was dispatched to sign the deal, is talking about future orders from Russia that sound suspiciously like the ones that were being talked about before the takeover. And it turns out that Yusufov is closer to former owner, Burlakov, than anyone knew. The two not only visited the shipyards together earlier in the year -- but Burlakov has referred to "his good friend, former comrade and personal advisor," by which he meant Yusufov. And that was even though the pair had always acted as though they had never had anything much to do with one another.

Still, Weidt and his co-workers are not going to let this disturb them. Weidt remains objective about what has been happening over the past months. Around here, they describe it as the typically relaxed northern German attitude. It is only when he talks about his own fate that Weidt becomes somewhat more taciturn, staring out of the window. Nobody knows if he will get back to the yards or if he will get to run the plant's equipment again. There is a 50-50 chance. And he will just have to live with any decisions made. Maybe he'll be lucky and get his old job back.

Until the purchase has been completed, Weidt will be working with the insolvent shipyard's holding company. Just like most of his colleagues, he will be paid around 75 percent of his net wage for the next few months. Additionally he is doing some extra training -- a course in driving a fork lift and an English language course. After all, there's nothing wrong with a little preparation. Just In case.


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