A larger and more resilient business

Order intake grew 23 percent in 2023 driven by an increased share of tankers in the ship contracting mix, a strong offshore market, a good development in services and a growing demand for our multi-fuel solutions. As our portfolio broadens and with the increased complexity coming from new fuel solutions in recent years, Alfa Laval continues to increase content onboard vessels.

After 12 months of margin pressure driven by both external circumstances and internal imbalances, a great emphasis in 2023 was on making sure that actions to improve profitability developed as expected. The programme launched in 2022 to address operational inefficiencies was implemented. The Boilers and Gas Business Unit have been merged into one with a consequent leaner management structure and lower cost base. Manufacturing in Aalborg, Denmark, was relocated to China with a better supply chain and footprint. Furthermore, the ballast water business has been right-sized to balance cost with the normalized demand level as the retrofit of existing vessels with these systems is almost completed. These initiatives together with a strong growth in service, an improved production load in the pumping systems business in the second half of the year, and good profitability in our growing multi-fuel portfolio helped improve the profitability of the division to 14.9 percent for the year.

The race to zero is on

In July 2023, the International Maritime Organization revised its greenhouse gas strategy and now aims for the industry to be net zero around 2050, which is a step change from its previously stated ambition of a 50 percent reduction in 2050. The race to zero is on and the industry pathway to get there will involve implementing increased energy efficiency measures and deploying cleaner energy. There is however an industry consensus that green fuels will not be available at scale for shipping in the short to medium term, that the the energy transition in shipping will be a multi-fuel and multi-decade one. The Marine division is enabling this transition in three distinct dimensions. Foremost, we aim for our own offer to be carbon neutral by 2030 to lead the energy transition in shipping and help our customers to mitigate their scope 3 upstream emissions. In relation to the fuel transition, we are developing our existing portfolio to be multi-fuel capable to future proof our customers’ assets and a new range of fuel pumping systems for methanol and gas was launched in 2023. A triple digit number of multi-fuel solutions are now deployed and operational. Finally, we added several new energy saving technologies into our portfolio that attenuate the energy intensity of sailing vessels. Oceanbird, our wind propulsion collaboration with Wallenius, OceanGlide, our air lubrication solution and StormGeo, our digital solution are three good examples of solutions that can each reduce fuel consumption in excess of 5 percent. We see a strong demand for these solutions as the industry recognizes that any future fuel will be more expensive than the current ones and implementing energy efficiency measures makes sound economic sense.

A wider and deeper digital offering

In 2023, we further strengthened our Digital offering. This include StormGeo’s roll-out of the EU-ETS emission measurement solution within its fleet performance management suite to enable ship operators to comply with new EU legislative requirements that will come into effect in 2024. The roll-out of Flood analytics and a warning solution in StormGeo’s Terra suite helps land-based facilities to mitigate the impact of extreme weather events. In addition, we took over NSI’s bunker trading platform and coupled it with StormGeo’s bunker routing service to enable customers to not just optimize a vessel’s route around bunkering fuel but also buy/trade bunkers on this same digital platform in one seamless solution.

We continue to invest in our digital infrastructure to improve the digital customer journey and enable data driven services, which increase operational efficiency across the value chain. The customer portal launched  in 2022  to monitor Alfa Laval’s pumping equipment in real time continues to grow and more than 2,000 ships used this platform at the end of 2023, which is twice as many as in 2022. As with other digital services, the portal helps optimize use, simplify maintenance and in the longer term, improve overall operating efficiency for the customer. Alfa Laval’s ballast water systems are now supplied as connected assets by default and an increasing number of these are now coming on-line as customers recognize the off-hire risk connected to a non-operational or defective ballast water system during cargo operations. Implementation of a Customer Relationship management system and connecting this with our Installed Base tool has enabled our service support team to identify the service and upgrade needs of our customers with a couple of clicks rather than a demanding manual process.

Setting sail toward a sustainable future

In a world where sustainability is an ever-more urgent concern, A.P. Moller–Maersk has embarked on a ground-breaking voyage to introduce the world’s first methanol-fuelled container vessel. With Alfa Laval’s innovative solutions for methanol as fuel, this vessel embodies the way pioneering technologies and equipment can facilitate shipping companies’ adaptation to the evolving energy landscape and environmental regulations.

Methanol is increasingly emerging as a viable marine fuel, aligning with the shipping industry’s pursuit of cleaner and more sustainable energy sources. When produced from renewable resources, methanol has the potential to significantly reduce CO₂ emissions. Moreover, its compliance with the International Maritime Organization’s (IMO) stringent emission regulations has sparked widespread interest in its adoption as a marine fuel.

With the ambitious target of achieving net-zero greenhouse gas emissions by 2040, A.P. Moller–Maersk, a renowned Danish shipping and logistics powerhouse, is swiftly propelling itself toward the adoption of novel technologies, state-of-the-art vessels, and clean fuels.

Operating a vessel powered by methanol requires thorough attention to onboard equipment, safety and user-friendliness. The 172-meter-long ship is equipped with an array of Alfa Laval’s products and solutions, including FCM Methanol fuel supply system, methanol-ready steam boiler system, freshwater generator, heat exchangers, and separators. These components are meticulously designed to accommodate methanol as a fuel source while simultaneously enhancing vessel efficiency through energy savings and a reduced carbon footprint.

Over the years, Alfa Laval has established itself as a pioneering solution provider by expanding its capabilities for alternative fuels and energy-efficient solutions. Through its firm commitment to research and development, combined with an unparalleled service network, Alfa Laval supplies its customers and partners with innovative, sustainable technologies to help navigate the transition towards a cleaner, more environmentally responsible future.