School of Engineering


Agents' Behaviour: Buying and Selling of Ships

The aim of this sponsored PhD research is to determine periods of ownership of commercial ships built in the period 1987 to date, and how the pattern of ownership may have changed over this period, in order to give a better understanding of ship owners’ past, current and likely future behaviour in terms of investment horizons and vessel sale and purchase policies.

In modern shipping the use of sophisticated investment valuation tools is not the rule but the exception and investment decisions are often based on the useful economic life of the asset, which can be misleading. The purpose of this research is to investigate what can be regarded as the average period of vessel ownership in shipping and therefore determine the typical investment horizon for a vessel owner. This will facilitate marine service and equipment providers, such as sale and purchase brokers and retrofitted equipment and systems manufacturers, in targeting customers. The analysis, which incorporates factors such as owner nationality and company type, is focused on the three main ship types – bulk carriers, tankers and container ships. In order to fully address the nature of the data on periods of ownership and incorporate censored observations into the analysis, statistical techniques designed for time-to-event data and widely used in medical trials have been employed.

As part of this research the commercial records of 3,908 vessels 30,000 dwt and above have been examined resulting in 8,045 changes of ownership and data on 1169 companies. The results to date reveal that the patterns of behaviour corresponding to first and subsequent owners differ and that at least 20% of ships remain with their original owner.