Slippage, Risk, Quality and Liability
Posted on | May 13, 2010 | No Comments
It is increasingly clear that the shipping industry faces an influx of cheaply and shoddily designed tonnage in the tanker, dry bulk and containerised categories; that was the talk behind the scenes at this week’s Mare Forum conference, here in Rome.
Officials of certain leading classification societies who attended this conference were careful to point out during coffee and tea breaks that the ongoing construction overhang in China, which is still going forward, includes a significant proportion of shipyard-designed “product”, characterised by one class society executive as “marginal in design and execution.” Another well-known figure mentioned that “as we all know, non-IACS organizations are involved in much of this”.
While this week’s adoption of a general framework on goal-based design and construction standards at IMO was described as being a significant improvement in approach, the overall reaction to qualiity issues at far eastern yards seemed, at least in the corridor discussions, to be pessimistic.
The biggest stumbling block, it is agreed, is clearly money–or rather the lack of it. With credit hard to come by, and the price of steel zooming upward, there is an awareness that the growing tide of environmental regulation means that we will need new technologies, new construction methods, new materials for new ships.
The speculative, asset-play-generated tonnage now being completed at Chinese and Korean yards is, as one delegate said, “really just Yugos, when what will be needed will be BMWs.”
The bottom line is that that the current economic crisis comes at precisely the moment when our industry needs capital to pay for the new ships that will have to be built to meet MARPOL environmental controls, such as air quality, ballast and waste management, and fuel economy. Then there’s the final demise of single-hullers.
“To cap the climax”, nobody can say how much slippage there is, or will be, in the tonnage now supposedly on order in far eastern yards. We had two gurus present: the renowned duo of Slater (Paul) and Stopford (Martin).
Both went around wearing worried expressions. For the reasons why this might be so, you’ll have to read my next post.
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