Well, if this were a “normal” year, this piece would revolve all around the upcoming leading maritime trade fair SMM and – certainly to a much smaller extent – WindEnergy Hamburg. Both shows had to be postponed. Because 2020 is not a normal year!
Since the March editions of our publications, we have been reporting in great detail on the effects of the Covid-19 pandemic on all players in the maritime industry; on short-time work at shipyards, declining cargo handling in ports, losses at suppliers and, of course, the dramatic slump in the cruise industry and with it associated orders.
And it comes with no surprise that current figures continue to give cause for concern. According to The Baltic and International Maritime Council (BIMCO), the current order book is on a 17-year low, as the pandemic has massively slowed down contracting (-50%). Interestingly, it has had a limited effect on total deliveries which are down 1.7% in the first seven months of 2020.
Let’s face it: the virus will not disappear like that; without widespread vaccination, the already widely used “new normal” will remain the “only normal”. So are we all now burying our heads in the sand and still somehow hoping for a short-term miracle, i.e. a quick recovery of the market? Not at all. Companies believe in their future and are preparing for the successful management of the coronavirus crisis with investments in R&D, but also with cost-cutting and restructuring measures, which in some places unfortunately include staff reductions.
And those measures work: in its Q2 results, A.P. Moller- Maersk has just announced that despite a decline in revenue of 6.5%, its EBITDA across all segments improved by 25%. The decline was mainly offset by active network capacity management, higher freight rates, improved bunker efficiency and lower fuel prices, the shipping company states.
But coming back to SMM, which is now scheduled for the beginning of February 2021. Of course, we all miss the exchange, the meetings, the unique atmosphere and, last but not least, the exciting products and future-oriented developments that are presented in Hamburg every two years. And we certainly hope that this will only be a six-month postponement, unfortunately until far less pleasant weather conditions prevail.
In the meantime, we have decided to introduce the Innovation Report in this issue of Ship&Offshore (and also in its German sister publication Schiff&Hafen) to provide a written platform for all those exciting products and future-oriented developments that we cannot experience in real life this September.
We are particularly proud that British economist Dr Martin Stopford has agreed to set the scene for the report and give some enlightening perspectives on the current situation but also for the future of shipping. He concludes his essay (starting on page 21) with the prospect that the fleet now in service is not only a “real-time laboratory for developing and trialling new technology”, but also has fantastic retrofitting potential – a fact from which shipyards and suppliers in particular can benefit in the long term.
Stopford is a visionary and also challenges the industry to be more creative when it comes to dealing with current and future economic and environmental issues. Maybe it’s even time to risk a quantum leap in shipping. What this might look like is not yet clear, but the industry has many smart people who could certainly come up with some ideas.