On 23 September, the Majestic Maersk steamed past Copenhagen opera house at the end of its maiden voyage, its 43,000 horsepower engines purring and its twin 9.8-metre propellers gently whirling.
The ship is one of the first of the new Triple-E fleet, which comprises the world's biggest container vessels. As long as four football pitches and as wide as an eight-lane motorway, these monsters weigh in at 165,000 tonnes, and each one can carry 36,000 cars, or 18 million televisions.
Danish giant Maersk, the world's largest operator of container ships, with a turnover of about £6.6bn per annum, will build 19 more of these $190m ships in the next few years. They will ply the trade route from Asia to Europe through the Suez Canal.
Impressive? The tens of thousands of people who bought tickets to look around the ship while it was docked in Copenhagen - and to see a fascinating- sounding exhibition about containerisation - thought so.
This is a funny time to be launching such a leviathan. Shipping is in a monstrous pickle right now, because of a huge oversupply of big ships. In the five years since 2008, it has become commonplace for as little as 60% of the world's container ship capacity to be utilised. This has led to a price war and a collapse in freight carriage fees.
According to the Shanghai Containerized Freight Index, the cost of shipping a container has plummeted from more than $1,500 in early 2012 to less than $1,000 now.
The long-term chart looks even worse, a vertiginous sea you wouldn't want to be in, even in a 165,000-tonner. This is a bad time to be a ship-owner: 23 of the world's 30 biggest outfits lost money last year, and in 2011 alone the 16 largest publicly traded shipping firms lost $5bn between them. It's squeaky-bum time for the shipping tycoons.
Traditionally, shipping has been the stomping ground of buccaneers and chancers, men with deep tans, open-necked shirts, beautiful women on their arms and dangerously high blood pressure - glamorous socialites like Aristotle Onassis and risk-takers like Norwegian-born supertanker billionaire John Fredriksen, who risked the wrath of the US by shipping oil from Iran in the 1980s. Even our own larger-than-life Stelios Haji-Ioannou's first business, low cost airline easyJet, was borne aloft by money from the family shipping business.
But over the past few years of the industry's ills, an altogether more sober type has been dropping anchor: the private equity suits have arrived. Investor Wilbur Ross, worth according to Forbes magazine some $2bn and best known for rescuing failing steel, textile and automotive components firms, has invested more than $3.5bn in shipping. Other giant outfits such as Blackstone and Apollo are also getting in on the action.
Speaking earlier this year, Ross bleakly admitted that 'this probably means that the swashbuckling, larger-than-life characters typical of the industry will be less prevalent'. So will the exuberant tycoons be conquered by dull-eyed financiers, armed with scientific calculators and a black belt in Excel?
To an outsider, the industry's woes are hard to fathom. Surely shipping should be a licence to print money? Ninety per cent of the world's manufactured goods travel by sea en route from factory to consumer, after all, not to mention the vast quantities of coal, ore and other raw materials that bob their way around the globe from Africa and South America to China.
'It's simply supply-and-demand mechanics,' says Harry Theochari of law firm Norton Rose Fulbright, ranked the world's top shipping lawyer by Lloyd's. 'There are too many ships chasing too few cargoes, and so the amount you can charge for the use of your vessel goes down.'
This has happened because many people in shipping had convinced themselves - as did so many industries during the 2000s - that rather than following its old cyclical rhythms, their sector had undergone a paradigm shift and wasn't a boom/bust economy any more.
Theochari points out that in 1995, an average Cape-size vessel (so-called because they are too large to pass through the Suez Canal and have to go round Cape Horn) was being hired for $20,000 to $25,000 a day; by summer 2008, the price touched $200,000 a day. The good times, said the optimists, would last forever. They didn't.
The Triple-E titan - the world's largest container ship. Picture: REX/Imagechina
And in shipping as in construction, the lead time on new capacity is long - lots of ships were ordered during the boom years but came into service just as demand was falling. In 2011 alone, ships amounting to an extra 8.7% of total world container capacity were commissioned.
New ships are still being built, and at such a pace that vessels designed to last 25 years are now being scrapped after just 15. And yet there isn't anything like the demand to utilise this spiffy new fleet.
Unsurprisingly, this has led to an equally sizeable finance problem. In 2008, shipping took on $128bn of financing, 90% of which came from banks. But by 2012 just $40bn came from banks, 45% of the total.
Until banks shore up their balance sheets, they are unlikely to start pumping money into shipping again. All this helps to explain the rising presence of private equity - shippers are looking anywhere they can for money.
But the industry has always been notorious for its volatility. Cape-size vessels were being built in 1995 for about $50m to $55m. Ships are supposed to depreciate steadily over time, but vessels built in 1995 were selling for over $200m by 2008. Of course, prices have since collapsed.
Running costs are also ridiculously volatile: the price of lubricating oil can vary by 70% day to day and crew costs by 40%. And shipping companies are notoriously bad at business.
A recent report on the industry by Boston Consulting Group, Charting a New Course, bemoaned 'carriers' limited ability to gauge the true bottom-line impact of business decisions, which stems from their insufficient application of hard data and analytics'. In other words, decisions are made on gut and instinct at least as much as on fact.
Why, when there is already such oversupply, does investment continue? Fredriksen, worth £6.6bn, according to the Sunday Times Rich List and owner of the world's largest tanker fleet, is investing $4bn in ships and $7bn in 18 oil rigs. The shipyards of China, South Korea and Japan are ablaze with the glare of arc welders as more and larger new vessels are built.
'Shipping is probably the biggest poker game in the world,' explains Lloyd's Register chief executive Richard Sadler. 'These guys are making huge bets on the global economy.' They are gambling that in a couple of decades, China, Brazil and other emerging economies will boom enough to give them a return on the investments they are making now.
The private equity types might bring some much-needed financial sophistication to the table: the Wilbur Rosses of this world prefer games where the odds are stacked in their investors' favour. Says Sadler: 'I think the discipline that private equity will bring in will be good, and having a variety of ownership structures in the industry will be healthy.'
However, any hope that we are entering an era of rational, buttoned-down shipping magnates is probably a pipe dream. Most industry watchers doubt that outsiders can ever really understand the intricacies of shipping - this is a business with boatloads of arcane rules and traditions, deep knowledge of which can only be accrued from operational experience gained over decades.
And, although shipping remains highly fragmented, consolidation is unlikely to take place. Shipping firms are 'not too hot on M&A', says BCG shipping analyst Camille Egloff. Some are state champions who want to remain proudly independent, she says, while many are family-owned and don't want to dilute their power or wealth.
As Theochari says: 'A lot of these entrepreneurial ship-owners find it very hard to work with other people and make decisions with them.'
Shipping probably won't change fundamentally then - at least, not yet. The financial wizards want to come in, make a buck, then get out before the cycle turns. But most observers reckon that the industry will remain dominated by family firms and mavericks. That's because, if the cards fall in your favour, there is potentially so much money to be made that even a minuscule slice of it can make you fabulously wealthy. Huge risks do occasionally generate huge returns.
What might change though is the geography - it's predicted that by 2030, 60% of the world's ocean traffic will be between China and emerging Asian countries such as Vietnam, Indonesia and Thailand. Already, China-Brazil shipping is booming. So the seagoing buccaneers of the future might not be Greek or Nordic but Asian and South American. Plus ca change, plus c'est la meme chose.
TYCOONS ON THE OCEAN WAVES
Aristotle Onassis
The granddaddy of shipping tycoons was the son of a father called Socrates and a mother called Penelope - he was always going to live an epic life. Onassis made his fortune in tobacco before turning to shipping. He had an affair with opera singer Maria Callas and later married the widowed Jackie Kennedy. He died in 1975.
John Fredriksen
Norway's richest man until he took Cypriot nationality in 2006, Fredriksen got into shipping in Beirut in the 1960s. He made his fortune shipping oil from Iran in the 1980s - his biographer dubbed him 'the lifeline of the Ayatollah'. With the largest oil tanker fleet afloat, the world's most influential shipowner is worth $12bn.
Arnold Maersk Mc-Kinney Moller
Denmark's richest man was worth £13bn when he died in 2012 at 98. Mc-Kinney Moller built Maersk into the world's largest shipping group. He was famous in a dressed-down country for wearing a tie. The only non-head of state or royal to be made a knight of the Danish Order of the Elephant in his lifetime.
Robert Bugbee
The iconoclastic boss of tanker company Scorpio has committed to eco-ships that use 30% less fuel, ordering 16 at a cost of over $500m. Bugbee, 51, is a rare non-family shipping success, making his name from the sale of listed tanker business OMI for $2.2bn in 2007. Some, however, doubt the prospects for his new green fleet.
Tung Chao Yung
The 'Onassis of the Orient' was the first Far Eastern shipping mogul and at one point owned 150 vessels. He converted the RMS Queen Elizabeth into a floating university in 1970 and, when it sank, ensured its immortality by allowing the wreckage to appear in the James Bond film The Man with the Golden Gun. He died in 1982.
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