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The Evolving Tanker Market FLEET AGE PROFILE As at June 1994 76% of oil major vessels were built before 1980 Shipping independents have the smallest percentage of vessels over 20 years Government fleets have the largest percentage of pre-1970 vessels EE State oil companies have the largest percentage of 5 year-old vessels in their fleets Pre-1970 1970-74 1975-79 1980-84 Year of build 1990-94 |H Oil major ||| Independent oil co. [ J State shipping co. [J] Government State oil co. Q Shipping independents Source: Drewry Shipping Consultants. Twenty years ago the seven oil majors owned outright a quarter of the world's tanker tonnage, and at the same time controlled an additional 50 percent through long-term time charter commitments. Today, they own less than nine percent, and have little tonnage on long-term charter. This represents a massive structural change for the oil tanker fleet. The impact on ownership, chartering and operating policies is detailed and analyzed in a 198-page report from Drewry Shipping Consultants en- titled The Oil Tanker Fleets. Faced with the continued poor profitability of shipping and de- mands for higher safety standards, oil majors have conducted a thorough review of their atti- tude towards shipowning and operating in the 1990s. The relationship of shipping indepen- dents and oil majors is now at a turning point, the report concludes. The average age of their fleets ranges up to 20 years, but all fleets contain tonnage which will need to be renewed in the near future. With crude oil demand forecast to increase gradually to the end of the millennium and the oil majors continuing to deplete their owned fleets, both the size and market share of the independent shipowners looks set to increase even more. However, many owners' resources have been depleted by the decline in the under- lying value of their assets by weak trading re- turns from the spot market. This is evident from the downturn in new orders and fierce competi- tion from charters. The big question to be an- swered is: how many shipping independents can continue to survive in an industry that has proved almost incapable of producing returns from trading over the past 20 years? The report concludes that if the cream of the shipping inde- pendents are unable to negotiate good long-term charter contracts, then their compatriots will continue to suffer at the hands of the spot mai ket. The eventual outcome of BP's well-publ cized proposal to time-charter newbuildin Suezmax tankers is a case in point. It is to b hoped that independent shipowners have learne a lesson from the last cyclical peak. Low seconc hand values allowed conventional industry wis dom to be: buy vessels cheaply, watch asse values and earnings will take off. Middle-age tonnage was being sold at inflated prices in hop that it would be around long enough to benef from an improvement in industry fortunes. For more information on the Drewry report Circle 9 on Reader Service Card PROPULSION UPDATE ABB Turbo Systems takes market challenges in stride with an invigorated focus on customers and new product introductions by Greg Trauthwein, editor Serving the needs of two distinct customer bases in an ever-evolving market is an unenviable task. For ABB Turbo Systems of Baden, Swit- zerland, it's business as usual. While attending the 21st Con- gress of CIMAC, Georg Clauss, marketing manager for ABB Turbo Systems, talked about the changing dynamics of the maritime industry, The TPS 50 is the first in a new series of turbo- chargers. The unit was designed with increased pressure ratios at high efficiency levels, with a compact design in mind. and how ABB Turbo Systems is pc sitioned to meet customer need within those dynamics. The Market Two groups, engine builders an vessel owners, are the target mai kets for new ABB turbocharger and after-sales service. For the cori tent of this article, Mr. Clauss fc cused on new turbocharger sales. While the maritime market cor ditions are fairly standard Busines 101 fare — increased focus on re ducing price, increasing quality an cost-efficiencies — ABB's size an flexibility have allowed it to answe 24 Maritime Reporter/Engineering New;
