Laid-up and laid-off
“Forewarned is forearmed” … unless you’re living in a dreamworld. Most maritime officials refused to listen to those who were speaking out against the unwarranted ordering of behemoth-sized container ships in recent years and were inclined instead to cultivate a “bigger-is-better” attitude with respect to ship construction.
Long after indications that a severe world-wide recession was developing, those officials continued to place orders for increasing numbers and ever-larger specimens of those giants. It was nothing more than a showy and ill-advised corporate fanning of feathers.
Two months ago, government analysts revealed, or admitted, that after many months of a tailspinning economy, the decline had actually turned into a recession more than a year earlier, in December of 2007 to be exact. In January of 2008, however, unthinking and half-asleep carrier officials, with a business-as-usual flair, were still at it … ordering another 151 vessels.
That ignorance is proving to be costly for those officials, as well as for those “expert” consultants who had been touting the construction of seagoing leviathans. In fact, we recall sitting in on a conference a short while ago and hearing one such “expert” encourage the design and construction of 18,000 TEU vessels. He was hallucinating.
Clarkson, the London-based industry research company, brought things into focus last week. As opposed to the 151 ships ordered in January of 2008, only nine (9) ships were ordered in January of this year. Shipyards in China received five of the orders and shipyards in Korea received the other four. The “Big 3″ in Korea, however, Hyundai, Samsung and Daewoo, received none of the orders. Shipbuilders in other regions, of course, including Japan and Europe, were also blanked.
As the situation becomes more critical, forced retirement of dozens and dozens of otherwise seaworthy vessels is now the order of the day. According to Clarkson, 372 vessels were scrapped in 2008, but just in January of this year as many as 75 had been assigned to the scrap pile. Other but newer surplus capacity is being laid-up rather than scrapped. The latest count of idled containerships reached a record number of 453, having a capacity of 1.35 million TEUs.
What’s worse than being a “laid-up” ship? … being a “laid-off” breadwinner. Hundreds of ships have been idled, but uncounted thousands of workers have been terminated because of shortsighted maritime interests. Jobs and people are unimportant, though, and that’s the real disaster. Instead of recognizing that this world-wide depression was caused by massive layoffs over the past several years, and that things will continue to spiral downward unless employment opportunities and buying power can be regenerated, maritime authorities are still in a fog. “We still haven’t seen the light,” one was heard to remark last week. The timing for the end of the credit squeeze will depend on how fast lenders can recapitalize, he said … as though failing credit and not joblessness caused the mess.
“We still haven’t seen the light,” he said … unwittingly.