How does the supply chain law affect you?
We mostly work with western suppliers. So I’m not worried that they’re violating human rights. Our largest supplier is Böhler in Kapfenberg, but the requirements require enormous additional effort.
How many people work in your administration?
In the group of companies we have 70 percent workers and 30 percent employees, and administration accounts for around ten percent. Research and development is partly integrated into production because we also produce many prototypes and further develop products, especially with large customers.
How much do you feel the shortage of skilled workers?
We can still score points in Austria and Europe when it comes to skilled workers. Many people in the rest of the world admire us for the dual training system, although it doesn’t exist in America, for example. At SBO, training begins in a training workshop. We have 26 apprentices out of almost 400 employees at the Ternitz location and take on eight to ten apprentices every year. Today’s apprentices are tomorrow’s skilled workers and we nurture and nurture them. For example, we have English courses in the company twice a week and sports activities. I am always impressed by the motivation of the apprentices; most of them stay in the company after their training.
The tax and duty ratio in Austria is the third highest in the OECD countries. Is this a problem?
The non-wage labor costs are high, we have to deal with that, we know that. But what hit us the most was the very high wage agreement. At the end of the day, we have to score points with our technology leadership and quality leadership in order to compensate for the disadvantage of high personnel costs.
Given your international clientele, why does it make sense to produce in Ternitz?
It has grown historically. Ternitz is our company headquarters and we supply the entire world with our largest production. We also have offices across the globe with manufacturing in Asia, Europe and North America. Oil and gas production in Europe is not large, but it exists in the Mediterranean, the North Sea and the Middle East is not very far away. Ternitz is our most modern production facility; for example, we have a 3D metal printing center here – and we have very committed and well-trained employees here. But we don’t produce a mass-produced product, we are very specialized and customers are willing to pay more for better products.
What skills can you take with you in the energy transition?
I don’t see the energy transition as a threat. The energy landscape will look different in 20 years than it does today, but in my opinion there will be many areas of application in which we can excel with our capabilities. Our products are used for geothermal drilling or for carbon capture and storage, and hydrogen requires a high level of material know-how in the area of steel. These new markets are still relatively small, but the growth rates are higher than in our core business. In principle, new opportunities and chances arise here almost every week.
Doesn’t this mean that SBO is deprived of its business basis?
Oil demand was at a record level last year, which means the core business is functioning and the new New Energy business area is growing continuously. Core business and new business are also communicating vessels and we will play in both fields. If the core business declines faster, the new energy sector grows faster.
How is the Russian war of aggression against Ukraine affecting your business?
Russia has never been very relevant for us; we have a relatively small repair and service workshop in Siberia, primarily for our western customers. We stopped all deliveries to Russia in 2022 in compliance with sanctions. The share of total sales fell from around three to two percent.