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The Yearbook By The Numbers 221 • Tanker Market With ordersT^HHHHH oil prices rising will order be restored to the market .' Market Reports 23 Dry Bulk Market With scrapping at a 10-year high and economic factors looking up, what does the remainder of '99 have in store? 25 Shipbuildii Mergers and consolidations continue to re-shape the world market. 27 Offshore Following the immutable laws which govern it, prices will rise and business will boom again. But whenjand where? 34 Inland The resolution of several key legislation matters will effectively shape the shal- low draft market for years to come. 54 10 Significant Marine Innovations Profiled are a selection of new and proven maritime technological accomplishments, including Bouygues' new Field Development ship; a new naval marine power initia- tive; and a highly cost-effective and flexible RoPax design. 10 31 48 78 92 98 117 108 132 Investment in Design LR has embarked on a reorganization and investment plan. Marine Finance OSE maintains steady course following rough 1998. Chemical Tankers The slump will continue. Company Profile MacGregor goes with flow. U.K. Maritime Report U.K. captures market share through acquisitions. Communication Report Y2K ... Are You Ready? Shipyard Orders The World Fleet Ship Repair & Conversion Market Indices 87 Luther's Way i' L M rSlSXmBmBfk. . \ tarting with the Rhodoyster in 1949, uther Blount has served the maritime market with a unique sense of design and entreprenuership that has left the man — some 50 years ana 300 vessels later — a proven success and still driven. — by Regina P. Ciardiello ABOUT THE COVER: This year's June Yearbook edition cover photograph was provided by Walter Garschagen of Walter Garschagen Photography. Mr. Garschagen specializes in maritime and industrial photography, and travels worldwide photographing vessels and operations for the mar- itime industry. For information on utilizing Mr. Garschagen's exper- tise, contact him at: Walter Garschagen Photography 22 Division St., Cold Spring, N.Y. 10516 tel: (800) 333-8385 Subscriptions: One full year (12 issues) $18.00 in U.S.; outside of U.S. $96.00 including postage and handling. For subscription information, contact: Dale Barnett, fax: (212) 254-6271; e-mail: barnett@marinelink.com A host of unnatural market forces, including subsidies and the proliferation of a myriad of political agendas, have con- spired to keep ship prices artificially low, according to ship- builders. These claims seem to have merit, given a survey of select shipbuilders and some number crunching by the MR/EN staff. For example, the price of VLCC and Suezmax sized tankers has hardly advanced as one might expect, particularly when the numbers are adjusted to account for inflation. To make the comparisons more interesting, we have noted the price advances of a host of consumer products, from a loaf of bread to a Ferrari. Please note, however, that different time- lines are utilized in several cases, due to information available. The Results Price comparison of ships and goods, using inflation adjusted pricing. Song of Norway (1969)v. Voyager of the Seas(1999>: Increase: 734% 1974 Ferrari v. 1999 Ferrari: Increase 420% 1974 Corvette \. 1999 Corvette: Increase 102% VLCC Tanker 1986 v. VI.CC Tanker 1998: Increase 22% Gallon of Gas (1974 v. 1999)
or N Prices for VLCC and Suezmax are for period between 1986 and 1998, and are in $ in millions. Red line rep- resents inflation-adjusted $; Black line represents actual $ paid. Cruise MupH Ferrari • Corvette ^m Gasoline In 1969, Royal Caribbean payed $13.5 million for Song of Norway, v. $500 million for Voyager of the Seas, which is cur- rently under con- struction in Finland. 200,000 — - 150,000 100,000 - 50,000--=- - 1974 price was $14,000 ($46,200 in today's dollars), and was an 8- cylinder engine; versus $240,000 for a 12-cylinder model in 1999. (Source: Original Ferrari literature) < >usoIin 1.6 ] 1.2 4 0.8 4 0.4 • o 4 II - Bread 1 - 0.5 • 0 L. —i 1974 price was $6,000 ($19,800 in today's dol- lars); versus $40,000 in 1999. Increase; 102% The prices of both gasoline and bread, in infla- tion-adjusted $, has actually dropped. Gas: from $1.75 in 1974 to $1.35 in 1999; Bread from $1.12 to $.88. MARITIME AND ENGINEERING NEWS 118 East 25th Street New York, NY 10010 (212) 477-6700 ISSN-0025-3448 USPS-016-750 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means mechanical, photocopying, recording or oth- erwise without the prior written permission of the publishers. No. 6 Vol. 61 Founder: John J. O'Malley 1905 - 1980 Maritime Reporter/Engineering News is published monthly by Maritime Activity Reports, Inc. Mailed at Periodicals Postage Rates at Waterbury, CT 06701 and additional mailing offices. Postmaster send notification (Form 3579) regarding undeliverable magazines to Maritime Reporter/Engineering News, 118 East 25th Street, New York, NY 10010. Canada Post International Publications Mail Product (Canadian Distribution) Sales Agreement No. 0970700. Printed in U.S.A. Publishers are not responsible for the safekeeping or return of editorial material. © 1999 Maritime Activity Reports, Inc. Member INTERNATIONAL® Business Publications Audit of Circulation, Inc. 2 "The Yearbook" Maritime Reporter/Engineering News