Israel Shipyards teams up with Dubai Ports World in a bid for Haifa Port

The shipyards are located at the back of the state-owned harbor and present one sector – the designing and building of shipping vessels – in which the privately owned part of the harbor is involved.

Containers are seen in this general view of the port of the northern city of Haifa April 23, 2013. (photo credit: REUTERS/Ronen Zvulun)
Containers are seen in this general view of the port of the northern city of Haifa April 23, 2013.
(photo credit: REUTERS/Ronen Zvulun)
Israel Shipyards announced a new partnership with Dubai Ports World on Wednesday. The pair is hoping to win the tender to run Haifa harbor.
The shipyards are located at the back of the state-owned harbor and present one sector – the designing and building of shipping vessels – in which the privately owned part of the harbor is involved. The others are importing cement, offering services to gas drilling operations in the region, among other things.
The colorful flag of Senegal still waves at the entrance of Israel Shipyards after the successful Tuesday delivery of two patrol boats to that nation.
“You want to know why they bought from us and not from France?" Tzvika Shechterman,  CEO of Israel Shipyards, asked The Jerusalem Post. "Because these vessels are, we think, the best in the world.”
From Left to Right: Owners of Shipyards Israel Sami Katzav, Asi Shmeltzer and Shlomi Fogel. (Photo credit: Daniel Chersky)From Left to Right: Owners of Shipyards Israel Sami Katzav, Asi Shmeltzer and Shlomi Fogel. (Photo credit: Daniel Chersky)
Israel lacks seamen, but when the matter is innovative design of shipping vessels, it can sell ships to the seafaring Greeks, as the shipyards did in 2004 to offer better security during the Summer Olympics.
“Our best client is the Israeli Navy,” Israel Shipyards owner Sami Katzav told the Post, “because thanks to them other clients know our vessels are ‘combat proven.’”
The shipyards also modify vessels according to feedback they get from the navy. They invented a fast – and quiet – propulsion method which became the new standard in patrol ships, such as the two purchased by the Senegalese.
“We build ships here,” Shechterman noted, “from top to bottom.” Vice president of manufacturing Yoav Raanan explained that modern ships are built section by section, and then they are welded together to make one enormous body. This is followed by making them serviceable by installing everything the sailors need, from toilets to cannons, testing it at sea and only then – after three-years of labor to make one rocket boat – transferring it to the client.
“We can build even six ships at the same time in this place,” he proudly said.
By creating a state-of-the-art delivery system for cement shipments, large pipes that deliver cement powder by using powerful air pressure, to enormous containers, the harbor is able to offload a shipment in one-sixth of the time such shipments take in other Israeli harbors. Israel needs to import half of its cement from other countries. In shipping, time is money, the reduction of costs means cement costs decreased countrywide. This led to lower construction costs and less expensive housing.
If this tender is won, they intend to offer the same services for grain shipments, which could mean lower costs in that market for such common products as beer and bread.
It was “25 years ago when this part of the harbor was privatized; workers burned tires in protest,” Shechterman said, “during these years, nobody quit and nobody was fired. We care about our workers because, without them, there is no harbor.”
DP World began employing the BoxBay storage method in its Jebel Ali Terminal in Dubai this month. Meant to triple storage capacity and improve crane efficiency by 20%, the system enables stacking containers in seven-story structures and easily extracting them for delivery. It also takes its initial steps by using a hyperloop, delivering cargo through sealed tubes with low air pressure and almost no air resistance.
As Shecterman sees it, “Haifa harbor is small, but there’s a reason the British built it here.”
DP World could offer the technology and experience to maximize the efficiency of the relatively small size of the port, but it could also find roads into the larger Arab market via Jordan to the near east and Asia. In his 1902 utopian novel Altneuland (The Old New Land), Theodor Herzl predicted that such shipping would put the Suez Canal out of business. A century after writing his words, the Israeli-Dubai partnership could make that a reality.
Shanghai International Port Group (SIPG) will operate Haifa harbor, which Israel Shipyard speakers intimated, has enough pull to ensure that Chinese companies will opt to deliver their goods via the harbor when it is completed. “When you swim next to sharks,” it was hinted, “you need to have some powerful friends at your side.”
DP World, which handles 9% of the global shipping business, appears to be such a friend.
Israel Shipyards aren’t the only ones interested in competing for the Haifa tender.
Turkish company Yiloport, London-based company Global Port and the US logistic powerhouse GraeStone joined Israeli businessman Eli Tiles in their own effort to win it, the daily financial Globes and Port2Port reported.