Three views on the long-term development of the tanker industry

As the tanker business moves forward it will face three distinct challenges. The first is travel and the impact on overheads. Obviously, travel was greatly reduced in 2020 and this resulted in some fairly significant overhead savings. The question is, will that remain the case? From a personal and management point of view, I miss being able to go on ship visits, speak with the crew and gain a first-hand, unedited version of the environment they are working in.

This is especially important in view of the hardships that seafarers have encountered over recent months. It is particularly difficult to deal with their issues via email and through online meetings on board. That is something that will have to change in the longer term.

It is unclear what form this new communication will take, but I do not believe that we are going to be shedding our premises and reducing overhead costs, in the sense of real estate and utilisation of rentals. But I do think that there is more likelihood that people will want to have a balance in terms of working from home. It is a proven optionality that exists today and will likely continue to exist in the future.

The reduction in travel has resulted in business gaining from productivity levels, but at some point travel will revert, not quite to the levels we had before.

“It [will be] difficult to attract top talent into the tanker industry when there are so many new and interesting careers around”

The second point is trust – the trust sea staff put in the company. In 2020, shipping companies had to draw on every inch of goodwill that existed between management and ship staff. They trust that we are doing our utmost to get them off the ships, as well as getting them back on. My question is: will ship staff forgive the industry? In hindsight, did those they trust do the utmost to get the crews off the ship?

In one respect, it has been good for the younger generation – so used to instant gratification in so many aspects of life – to be confronted with these challenges and realise that instant gratification is not sustainable. This will make it difficult to attract top talent into the tanker industry when there are so many new and interesting careers around.

The third point is the concept of regulation versus technology. There have been instances of science versus science fiction. Sometimes, regulation is viewed as scientific fact, when it actually needs science fiction from the technology side to be able to make it work. That is always going to be the case in the shipping industry. Regulations require leaders and early movers to pave the way for the majority, but it is not necessary to be the leader in every capacity.

Return on investment and return on capital are key concepts in this business and when it comes to regulation and investment, the path of least resistance avoids investments in new and unproven technology. Sometimes, there are good reasons to lag.