Survey: LNG Retrofitting Sparks High Interest

There is a strong interest of shipowners in retrofitting their ships with liquefied natural gas-powered (LNG) engines in order to meet the requirements of the Ballast Water Management (BWM) Convention, a survey shows.

Specifically, according to the findings of SMM’s first Maritime Industry Report, some 54 percent of responding shipowner CEOs intend to retrofit their ships accordingly.

Stricter environmental regulations have made LNG a top choice as an alternative to conventional ship fuels. 44 percent of respondents said LNG is their first choice when contemplating ship newbuilding orders. But hybrid solutions based on marine diesel are likewise popular, the survey reveals.

“There is no way around the energy transition in the maritime sector. The increasing number of newbuilding orders and retrofits shows that LNG is gaining ground. The future of low-emission shipping has long begun,” says Reinhard Lüken, General Manager, German Naval Architecture and Ocean Engineering Association (VSM). The supply industry agrees, with 49 percent of respondents saying they consider LNG as the champion among alternative fuels.

Another item high up on the agenda is Autonomous Shipping: 36 percent of shipowner executives believe it to be the future of merchant shipping. 90 percent of those in support believe that the use of unmanned ships will be routine in as little as 20 years.

“We have seen an enormous shift in public opinion here,” says VDR Managing Director Max Johns. The two-decade horizon is not a far-fetched prospect, considering the average service life of a ship, he adds.

The results of the survey show that the overall Maritime Industry Score was 54.6 points, with the shipping segment’s 33.2 points clearly lagging behind shipbuilding (47.1 points) and the supply industry (61.9 points). These figures represent the ratio of positive versus negative growth expectations.

As disclosed, the surprisingly positive outcome proves that the industry is beginning to see light at the end of the tunnel.

Shipowners view the growth prospects as positive, indicating an increasing willingness to invest, as one particular survey result reveals: 20 percent of responding decision-makers consider it as ‘very likely’, and an additional 12 percent as ‘likely’ that they will order new ships within the next 12 months.

Further findings indicate that the maritime sector is already showing great interest in remote monitoring of ships and ways to protect ships against cybercrime.

“The opportunities and challenges of digitalization are on everybody’s mind in this industry. Therefore this topic will play a key role at SMM 2018, for example during the Maritime Future Summit,” says Business Unit Director HMC Selbach.

New technologies that can be helpful in optimising processes and increasing efficiency are in demand. Accordingly, 66 percent of respondents from supply companies see a “high” or “very high” sales potential for their products in the market. Three out of four (74 percent) have observed that innovative technology is being welcomed by customers.

The responding suppliers believe that the German, Chinese and US markets have the highest growth potential.

HMC plans to conduct the SMM Maritime Industry Report every two years in order to draw a continuous picture of the maritime industry mood.

“Our first comprehensive industry survey is a great source of inspiration as we prepare for the next SMM in September 2018,” says Bernd Aufderheide, President and CEO, Hamburg Messe und Congress GmbH.

The survey reflecting the views of more than 2500 participants from 69 countries, including representatives of shipowning companies, shipbuilders and suppliers.