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Ship managers must adjust to new reality, says OSM boss

Ship managers must adjust to new reality, says OSM boss
Today’s shaky shipping markets are no short-term phenomenon, says the chief executive of ship management firm Norwegian-owned OSM.

Geir Sekkesæter believes the breadth and depth of the current downturn which, he points out, embraces the offshore sector for the first time, will require a complete re-think of future business models. A new generation of owners including reluctant financial institutions forced to repossess distressed assets, and investors looking to snap up cheap deals, will be looking for ship management based on models geared to completely different cost structures and embracing high-throughput satcoms technology to facilitate new operating and maintenance systems.

Arendal-based OSM – with 30 offices around the world – has developed a range of bespoke ship management packages geared not only to traditional customers but also to new clients with little knowledge of day-to-day ship operation and no capability in-house.

OSM, Sekkesæter revealed, has about 10,000 seagoing personnel on its books and around 500 ships managed in a range of management packages, from straightforward crewing arrangements to full technical management and, for some, complete commercial management as well. Now, he said, a new all-inclusive service will target the latest generation of investors and owners who have scant operating knowledge or capability themselves, but who see the potential upside in asset appreciation as markets recover. This may not be any time soon, Sekkesæter added wistfully.

Whatever happens, he said, ship managers must prepare themselves for a new reality and a fundamental change in cost structures. There will be a permanent shift, whatever happens, he said, pointing to the ownership of shipping assets by non-conventional entities including banks, finance houses and even shipyards.

With a strong lineage in offshore vessel management, OSM is steadily diversifying its portfolio and merchant vessels now make up more than 60% of vessels under management. Sekkesæter’s aim is to double the number of ships under management and seagoing staff by 2019.