Cavotec powers transport with profitable sustainability

Sustainable profitability or profitable sustainability? With its innovative automation and electrification solutions, engineering group Cavotec is achieving both, and in the process is enabling a sustainable future that makes financial sense. Cavotec has laid the foundations for the future, now it’s time for growth.

Visit any industrial port and you will see and hear huge ships moored along the quayside. You might hear their diesel-powered engines rumbling away and feel the thick smell of exhaust that sticks in your nose – ships need electrical power at berth. You could be forgiven for wondering whether this is sustainable for humans and the environment alike. And the answer is no.

But there are already solutions available that eliminate these environmental threats. With its unique position on the market, Cavotec offers innovative technological solutions that make transport more efficient and more sustainable. The journey here has not always been smooth, but the way ahead is clear.

“When I came to Cavotec in 2017, it was a company that had stalled – it had promising technologies but faced challenges in terms of production and profitability. Since then, we have created a firm footing and are now seeing results,” says Mikael Norin, Cavotec CEO.

Since Bure came in as a major shareholder, Cavotec has undergone wide-ranging changes, not least with the appointment of Norin who cut his teeth in major companies such as ABB and Rolls-Royce and brought with him extensive experience of restructuring businesses. His task was to think big and work globally – to restructure Cavotec and shift its focus to growing markets such as Asia and North America. That transformation is complete and now it’s full speed ahead.

Our strengths are our fantastic products, sound, sustainable technologies and excellent customer relationships. Our challenge was to address an ill-defined organisational structure and transform our corporate culture to be more performance- and goal-orientated. We’ve done this and it has borne fruit,” says Norin. He continues:

“We implemented a three-step plan that started with a structural transformation phase in 2017 and 2018. In 2019, we focused on refining and locking in the improvements that we had achieved by building on sales and focusing on profitable business areas. From 2020, we’re focusing on growth and will grow rapidly to generate the best possible returns.

“A thorough analysis, firm backing from our major shareholders and the board, along with extremely active internal communication have been crucial to our success. For example, I regularly hold “townhall” meetings via video link with all employees. In my experience, everyone needs to know how they can influence and contribute to targets in their daily work.”

Shore power in Stockholm

Back to those industrial ports. When ships are berthed, they require large amounts of electrical power, which is why they run their diesel engines. However, at the Värtahamnen terminal in Stockholm, passenger ferries are able to switch off their diesel engines and connect to electrical power, thanks to Cavotec’s Shore Power system. In simple terms, Shore Power is electrical cabling that enables ships to easily connect to shoreside electrical power. Cavotec has supplied Shore Power systems to ports and shipping lines throughout Asia, Europe and North America since 1985.

“We talk to our customers about profitable sustainability, i.e. how our solutions contribute to efficiency and productivity improvements and how the resulting contributions to reduced environmental impact are an added bonus. Right from the get-go, this helps us have positive discussions about how they can achieve their financial targets, while at the same time get to have “bragging rights” for their positive environmental impact,” says Norin and continues:

“Take our automated mooring system for ships, MoorMaster™, for example. With conventional mooring, it takes on average about an hour to moor a container ship. With MoorMaster™, it takes 30 seconds. For port operators that need to load and unload ships as fast as possible, this frees up time to handle more ships and results in increased revenue. From an environmental perspective, it results in an hour less of emissions for every ship, every mooring sequence.”

MoorMaster™ for ship charging

MoorMaster™ is one of Cavotec’s most promising products in the maritime segment. Regardless of whether it’s a vast ship or a small road ferry in the Norwegian fjords, mooring is a complex process that also represents a major safety risk for personnel. Cavotec’s solution is MoorMaster™. Instead of mooring lines and chains, MoorMaster™ uses vacuum technology to “suck” and hold vessels to the quayside. Safety is greatly improved for port workers as is efficiency.

“MoorMaster™ systems have been installed in Helsinki, and naturally we hope that Stockholm will follow suit.”

And in Norway, a major transformation is underway with the electrification of road ferries with Cavotec systems. With MoorMaster™ and Shore Power, electric ferries are quickly moored and automatically charged with electrical power.

“These ferries are at berth for a matter of minutes, so it is absolutely crucial that these processes occur quickly to ensure the ferries’ profitability. We now hope that the Swedish Transport Association will adopt the same system in Sweden.”

What lies ahead?

“I see two main trends. One, ports are becoming increasingly automated with autonomous cranes and trucks, and even ships. We’re playing a key role in enabling this transformation. Second, customers are increasingly moving towards flexible cost bases: they’d rather buy a service than a product. We’re preparing for this.

Norin concludes by saying that many investors discovered Cavotec in 2019. During the third quarter of the year, Cavotec’s share price started to surge upwards considerably.

“I believe that more and more people are beginning to understand just how well positioned we are for the future.

“We have similar solutions for airports, where our technologies that provide aircraft at the gate with heat, fuel, water etc., can increase the number of turn-arounds compared to conventional technologies. Our aircraft servicing systems also mean that we can eliminate the use of all diesel-powered vehicles that are currently used to service aircraft. This results in reduced environmental impact, less damage to aircraft and fewer accidents.

“Going to work every day in the knowledge that we’re actively contributing to a better, more sustainable world feels great,” concludes Norin.

Cavotec develops and sells sustainable technical solutions for ports and maritime applications and airports and general industry. One of the group’s best-known systems is the mooring technology MoorMaster™. Cavotec has around 900 employees and was listed on the Stockholm OMX in 2011. The group is present worldwide primarily in Asia, Europe and North America. Cavotec’s head office is located in Lugano, Switzerland.

This article appeared earlier today as an advertorial in business daily Dagens Industri in Swedish.