Houlder’s strategy consultant, Sean McLaughlin, attended many key events during COP26 in…
COVID-19: A catalyst for conversions?
Just as necessity is the mother of invention, the economic impact of the COVID-19 pandemic will parent plenty of vessel conversions. Huge market upheaval throughout the year and its associated commercial shocks have triggered a rethink among shipowners. Trading patterns are shifting and some charters are being reviewed, which is encouraging shipowners to consider if assets can be redeployed to exploit more lucrative sectors. Not least as successful precedents exist.
One quite radical example is the conversion of a US Helicopter assault ship into the high-speed passenger RORO ferry the HSC Manannan for the Isle of Man Steam Packet company.
HSC Manannan is a 96-metre (315 ft) car and passenger ferry which initially operated as a ferry for TT-Line. It was then acquired by the US Navy and adapted for military purposes, where it was called USS Joint Venture. The conversion almost doubled the vessel’s passenger capacity to over 820 and – at the time – was the largest conversion of a high speed catamaran ever undertaken.
Houlder typically gets involved from generating design options through feasibility and into full design with technical consultancy, detailed design and owner representation. Currently, Houlder is seeing an uptick in the number of feasibility studies. These range from conversion of a Cargo Ro-Ro vessel into a multi-role vessel for naval use, through to re-purposing older, Moss-type LNG Carriers into power barges.
Although some options may have more viability than others, companies are taking a step back, ripping up the rule book, and contemplating how adapt the current strategy. It is clear that, for many, making smarter, more cost-effective decisions today will be key to safeguarding future operations. Adversity often breeds innovation and the current global pandemic is forcing the market to explore alternative approaches and adapt to a ‘new normal’. It looks like the ‘baby boom’ of COVID-19 conversions is well underway.