An order worth $35 million for next generation icebreaker was
recently received by
) in Russia from Baltic Shipyard Ltd. A new icebreaking vessel is
being built in Russia for a state shipping company Rosmorport
Powerful propulsion and energy efficient electrical systems
needed for this innovation will be provided by ABB. This
significant contract is included in ABB's third quarter 2012 order
The new technique icebreaker is multifunctional and will run on
either diesel or electricity. Further, it will be efficient enough
to cut ice almost two meters thick at a temperature as low as minus
35 degrees celcius. Thus, making it indispensable for the
difficult conditions in the north of the Arctic Circle.
The use of an Azipod propulsion system provides energy
efficiency, reducing fuel consumption by up to 20%. According to
plans, the delivery of the systems would begin in 2013 while the
vessel will be delivered to Rosmorport in 2015.
ABB has been providing its services to the Russian market for a
long time and also enjoys a good reputation. The company is
renowned the world over for its propulsion system for icebreaking
Moving ahead, the emerging markets will be a significant growth
driver for ABB. Demand in mature markets is also expected to
improve. Customer capital expenditures have soared with the rise in
commodity prices. Increased capacity in some later-cycle
infrastructure-related businesses continues to exist. In many
sectors price stability has been attained and ABB has escalated its
prices to offset rising raw material costs.
However, ABB Ltd's results are likely to be adversely impacted
by macroeconomic weakness as more than 80% of the company's orders
are derived from outside the US. A major competitor of ABB Ltd. is
ABB Ltd. is a Zurich, Switzerland-based power and automation
technology company. The company operates in approximately 100
countries, structuring its global organization into five regions:
Europe, the Americas, Asia, the Middle East and Africa.
Currently, we maintain a Zacks #3 Rank (short-term Hold
recommendation) on ABB Ltd.
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