MAN Diesel will close the last of its in-house slow-speed engine factories this summer.

The Fredrikshavn, Denmark, facilities will continue to build smaller medium-speed engines, as well as propellers and gearings, but has just completed its last larger two-stroke power unit.

The closure brings to an end the European manufacturer's slow-speed engine building capabilities for larger vessels. It now relies on a global network of licensees, predominantly in China and South Korea, to build them.

However, there are reports that a number of MAN licensees are struggling to sell engines that have been built for orders that have now been cancelled.

"We don't know how many, but the issue is that these engines would have to be rebuilt if they remain in stock for more than a year and a half," said MAN Diesel head of low-speed business Thomas Knudsen.

The situation now is the reverse of that a year ago, when licensees were finding it difficult to keep up with the backlog of orders. Shipyards blamed engine builders and other large component builders for their own delays during the shipbuilding boom.

"It is hard to see the actual cancellations," Mr Knudsen said. "We get notice from the licensees that there has been a cancellation, but often it has not been noted on our books in any way."

However, he said the rate of cancellations had slowed recently.

"We have had two peaks, the second in March, but now we are seeing more postponements which are evening out the orderbook," he said.

A big peak the industry saw will always lead to a drought in orders, Mr Knudsen said.

He added that there would be a "long winter before the summer returns", although he could not say whether the industry would start placing new orders.