French Shipbuilding Industry

France is among the largest of the European military ship-builders, ranking second only to Germany in export production and far exceeding it in domestic military production. The greatest strength of French shipbuilding, as measured by dollar value, is found in the military sector and a substantial percentage of that is for export. As of 2005 the French commercial market represented a potential of about $1.4 billion per year of business. France’s military production, however, was forecast to average about $2 billion per year over the following decade.

Cardinal Richelieu opened the first naval dockyards in 1631. Major shipyards were built in France in Ruelle (1751), Nantes-Indret (1771), Lorient (1778) and, subsequently, in Cherbourg (1813). Others were to follow. France, in 1914, had seven shipbuilding yards with the following number of drydocks from 300 to 600 ft. long: Chantiers de France 5, Chantiers de St. Nazaire et Penhoet 4, Chantiers de Normandie 5, Chantiers de la Loire 7, Chantiers de la Gironde 4, Chantiers de Provence 6, Forges et Chantiers de la Mediterranee (La Seyne and Havre) 11. Other shipyards of smaller dimensions were: Chantiers Normand 3, Delaunay-Belleville 2, Chantiers Dubigeon 2, Chantiers de Bretagne 4, Dyle et Bacalan 3, Societe Provencale 2, Barriel 4. There were also yards at St. Malo, Paimpol, etc., for the construction of wooden vessels.

After the war France had five new shipbuilding concerns with from six to eight drydocks and able to build ships of from 3,000 to 8,000 tons. These companies and their capital (including both shares and debentures) were as follows:—Chantiers Navals Francais 60,000,000 fr., Ateliers et Chantiers de la Seine Maritime 30,000,000 fr., Compagnie Generale de Constructions Navales 35,000,000 fr., Societe Normande de Constructions Navales 25,000,000 fr., Chantiers Generaux de Cette 45,000,000 francs. As early as 1926, DCNS already had all the facilities now owned by the Group in mainland France.

France, like all other European countries, was restructuring its shipbuilding industry in the 1980s. Massive mergers consolidated France's five major yards into two were undertaken. The three biggest yards at Dunkirk, La Ciotat and La Seyne were merged into Chantiers du Nord et du Mediterranee. Alsthom-Atlantique de 1'Atlantique's operation at St. Nazaire was combined with Dubigeon-Normandie.

A new image for French shipbuilding was announced in December 1981 by Louis LePensec, Minister of Maritime Affairs involved the reorganization of shipbuilding around two poles, one private and the other public. The private pole, which was to unite three shipyards, France—-Dunkerque (of the Empain—Schneider group), La Ciotat (of which 89 percent of the stock belonged to financiers from Qatar, Kuwait and Lebanon) and the Mediterranean Naval and Industrial Constructions (CNIM, 84 percent of which was controlled by Herlicq) took form by January 1983. A new holding company, baptized Nord—Mediterranee by Louis Le Pensec, was constituted in order to unite the three shipyards. The industrial leadership was handled by France—Dunkerque. United in this way, the three private shipyards represented more than 11,000 persons and net sales of approximately Fr 3 billion, which put the group at the level of its principal foreign competitors.

The constitution of the second pole (the nationalized one) included the merger within Alsthom-Atlantique of three of its subsidiaries: Ateliers et Chantiers de Bretagne (1,500 employees), Soferval (1,800 employees) and Bassano (55 employees). The goal sought in this operation was to make the Alsthom—Atlantique group more effective commercially and more competitive technically, in order to be comparable to its international competitors.

There are several powerful maritime associations in France. The major one is the Association of French Marine Industries. Other organizations include GENEMA, the French shipbuilders' export association, and SIRENA, the French ship-repairer's association. These associations are expected to become more powerful because the demotion of the Ministry of Sea within the French Socialist Government. The shipbuilding associations were concerned about Government intrusion in the form of regulations and taxation. They also did not approve of the Government's plans for expansion when the industry is struggling just to remain competitive.

One area where French shipbuilders have met with success is in cruiseship construction. In 1983, two cruise vessels were to be delivered from Chantiers de 1'Antique, and one was under construction at La Seyne. The French earned a reputation for supplying a wide variety of marine equipment to overseas markets. Alsthom Atlantique and SACM in Mulhouse build some of the world's most powerful diesel engines. SACM diesels have been ordered for vessels ranging from inland waterways craft to high speed patrol boats. SACM has also built the world's largest platform and semisubmersible for offshore work. Sales' volume for marine equipment has been rising steadily for 5 years.

At the end of 1983, employment in the French shipbuilding industry totaled 24,000. At that time, the Government planned further restructuring in the industry, therefore, job losses were expected. Instead, the Government proposed shorter working time, a freeze on new recruitment, and early retirement. The Government also planned reductions in subcontractors and more training to improve flexibility within the work force.

A political decision that greatly affected the French Navy was the awarding of the frigate de surveillance (Floreal class) new construction contract to the Chantiers de l'Atlantique de Saint-Nazaire instead of to the government-owned Lorient Naval Shipyard. There were a total of 6 ships of the class built at Saint-Nazaire. As these ships were designed to operate in low threat areas, the Navy decided to reduce their cost by constructing them to merchant marine regulations called SOLAS (Safety Of Life At Sea) and VERITAS. This political decision came as a blow to the Lorient shipyard, which was lightloaded and badly needed the work.

Saint-Nazaire was responsible for building Floreal, but the DCN and Saint-Nazaire engineers were supposed to work closely together during the construction process to minimize difficulties in the weapon systems installation process scheduled for Lorient. Unfortunately, this did not happen. Saint-Nazaire delivered a "completed" ship to Lorient, and the DCN cut holes in the ship for weapons installation and cabling routes for the electrical connections. A closer working relationship between Saint-Nazaire and the DCN would have minimized this "reconstruction" process.

State-supported military and commercial shipbuilding is and has been French national policy and practice. Direction des Constructions Navales (DCN) reports directly to the Ministere de la Defense (MoD) under a January 2001 reorganization. Delegation Generale pour l'Armement (DGA), the French defense procurement agency, is responsible for military acquisition. The DCN d’Indret is the state owned naval shipyard. The Pays de la Loire region is the center of naval engineering and Frances’ Silicon Valley equivalent. The Institute for Shipbuilding Research (ISR), Ecole Centrale de Nantes, shipyards, trades, electronics/computer companies, and telecommunication manufacturers come together in Loire to create this strategic center of excellence.

The long history and continuing state support for shipbuilding strengthens the relative priority within the French national security strategy. The EU shipbuilding consortium or European Marine STEP Association (EMSA) committed to establishing the international model data standards of STEP (STandard for Exchange of Product) for interoperable data between Computer Aided Design (CAD) systems. France is an active member of EMSA and the International Standardization Organization (ISO). Improved productivity in French shipyards and marine service organizations is partially attributable to ease of sharing standardized data.

Overhead attributable to manual labor and man-hours, schedule delays and ultimately unit costs were decreasing in part due to use of IT. Decreasing costs can directly affect retaining market share of targeted shipbuilding sectors in the ever-increasing competition for new builds. French shipbuilding maintained their competitive edge in cruise liners, due to excellence, design and manufacturing modernization, IT and in part due to government subsidies.

French commercial shipbuilding is erratic and small in scale compared with that of Germany but is far more substantial than the remaining UK commercial production. A dip in the late 1980s coincided with the worldwide decline at that time, but the industry did not recover fully until the new century. French commercial production is concentrated in a single shipyard, Chantiers de l’Atlantique, and almost entirely on cruise ships.

By 2001, France’s cash strapped naval shipbuilding industry — recognized globally for its overall excellence in producing high-quality naval vessels — was representative of the problems facing the defense industry. As described by Defense Minister Alain Richard, “France’s shipyards are faced with responding to a limited number of new vessels ordered by the French Navy and a long time span between each new order. Thus, the industry can neither maintain its competence nor the diversity of its industrial site.