Companies going bankrupt/into administration

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raspberry-blower
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Post by raspberry-blower »

Some useful background reading - Fuel Consumption by Container Ship Size and Speed

Fuel prices can be found at Bunkerworld although a subscription is required

Finally shipping is infamous for using low grade bunker fuel (hence the named site above) which is highly polluting and results in large emissions of Nitrous and sulphurous compounds - amongst other nasties.
Recent OECD legislation requires shipping companies to reduce sulphur emissions:
Reuters: Container Shipping Firms' costs soar on new fuel rules OECD
From January 2015, ships entering Emissions Control Areas from the Baltics to the North American coast had to switch to ship fuels with less than 0.1 percent sulfur content, from 1 percent, as part of a campaign to combat marine pollution.

An even lower cap of 0.50 percent is planned for 2020 and it could add annual total costs of around $5 billion to $30 billion for the container shipping industry, the Organisation for Economic Co-operation and Development (OECD) report said.
Whilst this does not directly answer your question John, this can be calculated. The Reuters article quotes Danish shipping firm Maersk
Maersk Line, the global container shipping market leader, has said weak enforcement combined with the significant cost burden could prompt some shipping companies to flout the rules.

Maersk Line, a unit of Danish shipping and oil group A.P. Moller-Maersk, spent $6.1 billion on ship fuel last year of which 7 percent spent on buying the more expensive fuel.
I haven't had time as yet to look at Maersk's accounts - however it is something that can be calculated

Then there is the issue of enforcement of OECD rules...
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
raspberry-blower
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Post by raspberry-blower »

johnhemming2 wrote:I wonder what proportion is fuel costs.
A more direct answer to this question can be found here which suggests 70%.
Figures will vary from company to company with different ship engine sizes/modifications and practices, etc.

If you have the time and inclination it is worth having a quick look through the accounts of both the now bankrupt Hanjin and Maersk - though they are both lengthy documents. Both are in pdf format

Hanjin annual report can be found here

Maersk annual report can be found here

From Maersk's 2015 annual report the scale of the oversupply in the shipping fleet is laid bare:

Global container demand is expected to have grown between
0-1% in 2015 compared to 2014 while the global container fleet
grew by almost 8%. The low growth is primarily due to weaker
imports into Europe as well as slowdown in emerging economies
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
woodburner
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Post by woodburner »

That tells what is really happening in the world. Somewhat different from the story as told by politicians.
To become an extremist, hang around with people you agree with. Cass Sunstein
raspberry-blower
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Post by raspberry-blower »

An update on the on going collapse in the shipping industry:

Wolf Richter: Done in by Overcapacity, Stagnant World Trade and China, Korean Shipbuilders Collapse on Top of Taxpayers

The Mergers and Acquisitions (MA) has started in this sector:
Wolf Richter wrote:Larger carriers are consolidating to survive. Just on Monday, Japan’s Big Three – Nippon Yusen, Mitsui O.S.K. Lines, and Kawasaki Kisen Kaisha – announced that they would merge to form the world’s sixth largest container carrier.
Expect to see more of this in the coming months. This activity will push up share prices and the MSM will say "everything is rosy" when it is clearly anything but. Reality will hit in later:
Wolf Richter wrote: No one knows for sure how long the misery in the shipbuilding and shipping industries will continue. Overcapacity is a terrible condition. Creating it benefits many on the way up. It enriches them and makes the economy look good. But when it comes home to roost, the price is stiff. People lose their jobs. And many of the costs will be socialized. It’s only then that you see just how much capital has already gone down the drain, and how much more will follow.
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
raspberry-blower
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Post by raspberry-blower »

A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
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Mark
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Post by Mark »

raspberry-blower wrote:Another one bites the dust:

Telegraph: 700 jobs under threat as Jaeger goes into administration
There is always of natural cycle of businesses starting/growing/maturing/closing....
Jaeger is in the fashion industry and tastes have probably moved away from them...
There will be another fashion clothing company showing growth somewhere else
I don't see this as news of a wider trend....
johnhemming2
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Post by johnhemming2 »

Mark wrote:I don't see this as news of a wider trend....
WHS.
AutomaticEarth
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Post by AutomaticEarth »

Toshiba could be going BUST:

http://www.bbc.co.uk/news/business-39564956
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emordnilap
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Post by emordnilap »

raspberry-blower wrote:Another one bites the dust:

Telegraph: 700 jobs under threat as Jaeger goes into administration
Next?
I experience pleasure and pains, and pursue goals in service of them, so I cannot reasonably deny the right of other sentient agents to do the same - Steven Pinker
raspberry-blower
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Post by raspberry-blower »

Independent: Alitalia Italy's bankrupt national airline is up for sale
It has been struggling ever since a previous bankruptcy in 2008.
That's going to entice potential buyers :evil:

There must be quite a few other airlines teetering on the edge...
A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
fuzzy
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Post by fuzzy »

They can always blame it on brexit
raspberry-blower
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Post by raspberry-blower »

A common mistake that people make when trying to design something completely foolproof is to underestimate the ingenuity of complete fools - Douglas Adams.
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adam2
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Post by adam2 »

I cant see Carillion lasting much longer, they seem to have a knack for causing or attracting monumental c0ck ups !
Battersea power station has been a disaster for everyone with plans for it.
Contracts in Qatar seem unlikely to end well in the present climate.
And they are being sued over the new Taunton link road or bypass that opened today 2 years late and vastly over budget.
This last is small fry compared to some of the others, but is a fruitful source of bad publicity.
"Installers and owners of emergency diesels must assume that they will have to run for a week or more"
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emordnilap
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Post by emordnilap »

5 companies not currently going under AFAIK but spread around this article enough and who knows? 8)
I experience pleasure and pains, and pursue goals in service of them, so I cannot reasonably deny the right of other sentient agents to do the same - Steven Pinker
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Mark
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Post by Mark »

You never know, but the likelihood is that those 5 are still good for a few more years, despite the ratings....
Maybe Tesco is starting to change tack following their 'scare' a few years ago ?
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