“It’s better to burn out than to rust.” So wrote Neil Young back in the late 1970s in his great track Hey, Hey, My, My.
Shipping’s problem in recent years has been so few companies have actually burnt out. Yes, there’s been the high profile casualty that was Hanjin Shipping but can you name me another, let’s say, five big names who have gone to the wall in this downturn which has now stretched on for nearly a decade. Of course you cannot as what happens these days are the three words that dominate Splash headlines and corporate boardrooms at lines the world over: merger, acquisition and restructuring.
Back in the 1980s, the last time shipping had plummeted so low, a slew of well known shipping brands were scuttled, never to trade again. The difference between then and now is two-fold – 30 years back interest rates were running at 15%, today they’re next to nothing. Also back then, American banks in particular – and to a certain extent French ones – were far more prominent, and their brutal attitude when things hit the fan was to deploy lawyers and clear out fleets fast.
Nowadays, we live in different times where vultures lie in wait and struggling lines are picked up for a pittance and carry on, prolonging the agony of what has been one of most protracted recessions in the history of commercial shipping.
Why don’t we let more companies burn out? I would, but then as Neil says at the end of the song, “There’s more to the picture than meets the eye.”