The marine engine market is dominated by a very small number of major players with MAN Diesel & Turbo being the undisputed overall leader. However, the company’s dominance in the large two-stroke sector is not repeated in other sectors where other makers provide strong competition. The vast majority of large two-strokes may bear the MAN B&W badge but the company is not an active manufacturer.
Instead, the engines are produced by licensees in several countries around the globe. The company also licenses other companies to produce its smaller engines but is active in this arena in its own right.
The licensee business model is also used by engine manufactures aside from MAN. The licensees may not be as recognised by name as the big names which they represent but they can rightfully claim to be the larger manufacturers in the market. Many are licensees of two or more main companies. It is not unknown for licensees to introduce small changes in engine designs and in some cases to use different component suppliers. Thus engines which might be expected to be identical may feature several differences.
Until quite recently only three other manufacturers besides MAN – Wärtsilä, Mitsubishi and Caterpillar subsidiary Electro-Motive Diesel (EMD) – produced both two-stroke and four-stroke engines. Two of these have seen fit to withdraw wholly or partially from engine manufacture. In July 2014, Wärtsilä and China State Shipbuilding Corporation (CSSC) established a Joint Venture company, Winterthur Gas & Diesel, with the purpose of the take-over of Wärtsilä’s two-stroke engine business by the Chinese partner.
The joint venture assumed ownership of Wärtsilä’s two-stroke engine technology but servicing is still undertaken by Wärtsilä via its global service network. Last year, Wärtsilä transferred its 30% minority shareholding to CSSC giving it full control of the company. The four-stroke engine development and production which was actually the major part of Wärtsilä’s engine business remains with Wärtsilä.
In early 2017, Mitsubishi announced that it had agreed to transfer all of its marine engine production business to its long-time licensee, Kobe Diesel. As a consequence of the transfer, a new company Japan Engine Corporation (JEC) was formed to continue the engine production function. Although figures vary from time to time given the relatively small number of two-stroke sales, JEC has around 2-3% of the market in with MAN B&W claiming around 87% and WinGD 10%.
EMD is a US-based engine builder, formerly part of General Motors and now owned by Caterpillar. Its two-stroke engine installation base is mainly limited to US-built and operated tugs and pusher tugs.
Despite giving up its two-stroke business, Wärtsilä remains as the second largest player across all engine types behind MAN. The third spot is claimed by Caterpillar which as well as the EMD two-strokes produces medium and high-speed four stroke engines under its own name and also as MaK, a German engine maker which the US-based company acquired in 1997. Caterpillar has been a strong player in the offshore sector with both brands and the issues that have beset that sector will inevitably have affected Caterpillar sales.
To some extent, this may be offset by improved sales in the cruise and ferry sector where MaK has a strong customer base and which is one of the few sectors where new orders are relatively stable. MaK also has a respectable presence in the smaller cargo vessel sector powering ships of various types including container and chemical tankers and also tugs.
Beyond Caterpillar, rankings become less certain with some of the players having niche sectors where they are strong but little further market penetration. Rolls Royce has two diesel engine product lines with its Bergen and MTU brands. The former is also offered in spark ignited variants running on LNG. Rolls-Royce has strong naval connections that help provide work in hard times in the commercial sector. Both Bergen and MTU engines are popular in offshore, passenger and yacht sectors and MTU is also active in the tug sector.
Rolls-Royce is one of the very few players that can offer an alternative to conventional engines with its MT30 gas turbine engine being used on several naval vessels around the globe. The company did make an attempt to commercialise the engine in the early years of the 21st century but has not achieved any breakthrough as yet.
After the above players, the market tends to become regionalised with the smaller players serving local owners and builders. In Europe the remaining companies concerned are Anglo-Belgian better known as ABC based in Belgium, French maker Baudouin, Scania, and Volvo Penta. A few other engine names may appear from time to time; for example SEMT Pielstick a French maker now part of the MAN group or Deutz.
In Asia, a similar situation exists with Japan, South Korea and China all having one or more independent engine makers existing alongside the major licensees producing the more powerful engines. Japan has more than most counting Akasaka, Niigata, Hanshin, Daihatsu and Yanmar as makers of propulsion engines. South Korea has the home-grown Himsen engine coming from the Hyundai Heavy Industry stable which is generally considered as the most prolific licensee builder claiming to produce one in three engines globally. Finally China has the Chinese Standard Engine produced in several factories.
There are also a number of smaller players active in the US including Cummins which is most active in the smaller size offshore sector and GE Marine which produces a range of diesel engines suited to offshore and smaller craft and also a gas turbine the LM2500 type which has been installed in a small number of commercial vessels as well as naval ships. The company has a concept vessel which could see a gas turbine installed on an LNG carrier in the future.
The licensee production has already been mentioned above. As can be expected MAN has more licensees than any other engine company with some producing just two stroke engines and others a wider range including four-stroke engines and MAN design turbochargers. When Wärtsilä transferred two-stroke operations to WinGD, its licensees were also taken on by the new organisation. The following table shows the main licensee producers of the two companies.