Professor Manered Zachcial
5. Continuity and Change
diminished its presence.
Structural changes on the demand side have provoked the introduction and disparity of cooperation of the commercial side of their operation, mainly through the formation of pools. Trust continues to be at the core of the business:
for the main players it is the factor that allows the formation of networks of collaborating competitors. Bulk shipping has traditionally been a sector that rewarded the entrepreneurial spirit, adaptation and flexibility. The business environment for bulk shipping companies during the past century became more regulated and shipping operation more formalised. To a certain extent however, these changes diminished the entrepreneurial character and created the need to balance between the necessity to conform to the business’s environment requirements and the necessity to adapt for competitiveness. Still, the beginning and the end of the past century saw the largest part of world’s main tramp operators work more or less on similar lines.
* Department of History, Ionian University, Corfu, Greece. Email: [email protected]
† Department of Shipping, Trade and Transport, University of the Aegean, Chios, Greece. Email:
Endnotes
1. Harlaftis, G. and Theotokas, I. (2004): “European family firms in international business: British and Greek tramp shipping firms”, Business History, Vol. 46, No. 2, 219–255.
2. Fischer, L.R. and Nordvik, H.W. (1986): “Maritime Transport and the Integration of the North Atlantic Economy, 1850–1914”, in Wolfram Fischer, R., Marvin McInnis and Jurgen Schneider (eds.) The Emergence of a World Economy, 1500–1914 (Wiesbaden, Franz Steiner Verlag). See also O’Rourke, K. and Williamson, J.G. (1999): Globalization and History. The Evolution of Nineteenth Century Atlantic Economy (MIT Press), and Harlaftis, G. and Kardasis, V. (2000): “International Bulk Trade and Shipping in the Eastern Mediterranean and the Black Sea”, in Williamson, J. and Pamuk, S.
(eds.) The Mediterranean Response to Globalization (Routledge).
3. Eden, R. and Posner, M. (1981): Energy Economics (New York); Harley, C.K. (1989): “Coal Exports and British Shipping, 1850–1913”, Explora tions in Economic History, XXVI.
4. Sturmey, S.G. (1962): British Shipping and World Competition (The Athlone Press), pp. 75–79. In
fact, expansion of Norwegian shipowners to the ownership of tankers is considered as one of factors that contributed to the rapid development of Norwegian fleet during the interwar period. See Tenold S. (2005): “Crisis? What Crisis? The Expansion of Norwegian Shipping in the Interwar Period”, Discussion Paper 20/05, Economic History Section, Department of Economics, Norwegian School of Economics and Business Administration.
5. More on the subject and for further bibliography see Harlaftis, G. (1996): A History of Greek-owned Shipping, 1830 to the Present Day (Routledge), Chapters 6 and 8.
6. For an insightful analysis see Cafruny, A.W. (1987): Ruling the Waves. The Political Economy of International Shipping (University of California Press). For a classic on flags of convenience, see Metaxas, B.N. (1985): Flags of Convenience (London, Gower Press). For the resort of the Greeks to flags of convenience see Harlaftis, G. (1989): “Greek Shipowners and State Intervention in the 1940s: A Formal Justification for the Resort to Flags-of-Convenience?”, International Journal of Maritime History, Vol. I, No. 2, 37–63.
7. Sletmo, G.K. (1989): “Shipping’s fourth wave: ship management and Vernon’s trade cycles”, Maritime Policy and Management, Vol. 14, No. 4, 293–303.
8. See Thanopoulou, H. (1995): “The growth of fleets registered in the newly-emerging maritime countries and maritime crises”, in Maritime Policy and Management, V ol. 22, No. 1, 51–62.
9. More on the substitution relationship of the tramp with the liner see Metaxas, B.N. (1981): The Economics of Tramp Shipping (2nd edn) (London, Athlone Press), pp. 111–116.
10. Data contained in Stopford, M. (1997): Maritime Economics (2nd edn) (London, Routledge), p. 341.
11. According to data of AXS-Alphaliner, in 1 July 2009 the 38 ships in range of 10,000 to 15,500 TEU consisted of the 0.9% of the the world liner fleet while the same percentage of the orderbook was 18.1% (173 out of 955). Data available at www.axs-alphaliner.com (accessed on 15 July 2009).
12. For an analysis of the evolutions in the liner shipping, see Haralambides, H. (2007): “Structure and Operations in the Liner Shipping Industry”, in Hensher, D.A. and Button, K.J. (eds.) Handbook of Transport Modelling (Elsevier), pp. 607–621.
13. See the excellent analysis of Broeze, F. (2003): The Globalisation of the Oceans. Containerisation from the 1950s to the Present, Research in Maritime History, (St. John’s, Newfoundland).
14. Stopford, M. (1997): op. cit., p. 377.
15. Ryoo, D.K. and Thanopoulou, H.A. (1999): “Liner alliances in the globalization era: a strategic tool for Asian container carriers”, Maritime Policy and Management, Vol. 26, No. 4, 349–367.
16. Haralambides, H. (2007): op. cit.
17. Midoro, R. and Pitto, A. (2000): “A critical evaluation of strategic alliances in liner shipping”, Maritime Policy and Management, Vol. 27, No. 1, 31–40.
18. According to data of AXS-Alphaliner available at www.axs-alphaliner.com/top100/index.php (accessed 21 July 2009).
19. UNCTAD (2007): Transport Newsletter, No. 36, Second Quarter (Geneva, UNCTAD). The following data for the bulk shipping could be mentioned as an evidence of the different ownership structure of Liner and Bulk shipping. According to data of Clarkson Rersearch Studies, during 2003, there were five companies operating more than 100 ships, whose fleet percentage of the bulk carrier fleet was 14.3%. See Clarkson (2004): The Tramp Shipping Market, Clarkson Research Studies, p. 37.
20. Broeze, F. (1996): “The ports and port system of the Asian Seas: an overview with historical perspective from the 1750” The Great Circle, Vol. 18, No 2, 73–96.
21. Stopford, M. (1997): op. cit, pp.16–17.
22. However, regulations imposed on the shipping industry during the 1990s are among the factors that have contributed to the increase of the importance of the company size to the competitiveness of bulk shipping companies. For more on the subject see Theotokas, I.N. and Katarelos, E.D. (2001):
“Strategic choices for small bulk shipping companies in the post ISM Code period”, Proceedings of WCTR, Seoul, Korea.
23. Carvounis, C.C. (1979): “Efficiency contradictions of multinational activity: the case of Greek shipping”, unpublished Ph.D. thesis (New School of Social Research), p. 81.
24. Harlaftis, G. and Theotokas, I. (2004); op. cit.
25. Op. cit.
26. Cited in Palmer S. (2009): “British Shipping from the Late Nineteenth Century to the Present”, in Fischer, L.R. and Lange, E., International Merchant Shipping in the Nineteenth and Twentieth Centuries. The Comparative Dimension, Research in Maritime History No. 37 (St John’s, International Maritime Economic History Association), pp. 125–141, 129.
27. Thornton, R.H. (1959): British Shipping; Sturmey St. (1962): British Shipping and World Competition.
See also Palmer, S. (2009): op. cit. for an overall view of these arguments and the counterarguments.
28. Palmer, S. (2009): op. cit. Figure 4, 135.
29. Op. cit.
30. There is a large bibliography on the liner shipping companies; leading role was played by the so-called
“Liverpool School” founded by Professor Francis Hyde, main factor also in the creation of Business History. See Hyde, F.E. (1956): Blue Funnel: A History of Alfred Holt & Company of Liverpool 1865–1914 (Liverpool); Hyde, F.E. (1967): Shipping Enterprise and Management, 1830–1939:
Harrisons of Liverpool, (Liverpool); Marriner, S. and Hyde, F.E. (1967): The Senior: John Samuel Swire 1825–98. Management in Far Eastern Shipping Trades (Liverpool); Hyde, F.E. (1975):
Cunard and the North Atlantic, 1840–1914 (Liverpool); Davies, P.N. (1973): The Trade Markets:
Elder Dempster in West Africa (London); Sir Alfred Jones: Shipping Entrepreneur par Excellence (London). For P&O see Cable, B. (1937): A Hundred Year History of the P&O 1837–1937 (London); Howarth, D. and Howarth, S. (1986): The Story of P&O (London) and Rabson, S. and O’Donoghue, K. (1988): P&O. A Fleet History (Kendal); Napier, C.J. (1997): “Allies or Subsidiaries? Inter-Company Relations in the P&O Group, 1914-39”, Business History, Vol. 39, 67–
93. For British India (BI) see Munro, Forbes J. (1988), “Scottish Overseas Enterprise and the Lure of London: The Mackinnon Shipping Group, 1847–1893”, Scottish Economic and Social History, Vol. 8, 73–87. “Sir William Mackinnon” in Slaven, A. and Chekland, S. G. (ed.) Scottish Dictionary of Business Biography (Glasgow, 1990), Vol. 2, pp. 279–301. “Suez and the Shipowner: The Response of the Mackinnon Shipping Group to the Opening of the Canal, 1869–84” in Fischer L.
and Nordvik, H. (1990): Shipping & Trade, pp. 97–118; Munro, Forbes J. (2003): Maritime Enterprise and Empire: Sir William Mackinnon and his Business Network, 1823–93 (Woodbridge, Boydell Press 2003).
31. Starkey, D.J. (1996): “Ownership Structures in the British shipping industry: the case of Hull, 1820–
1916”, International Journal of Maritime History, Vol. VIII, No. 2, December, 71–95.
32. More on conferences in also Sturmey, S.G. (1962): op. cit. and Cafruny, A.W. (1987): op. cit.
33. For the story of Royal Mail see Green, E. and Moss, M.S. (1962): A Business of National Importance.
The Royal Mail Shipping Group, 1902–1937 (London, Methuen).
34. See also Sturmey, S.G. (1962): op. cit., chapt. IVX; and Boyce, G. (1995): Information, Mediation and Institutional Development. The Rise of large-scale Enterprise in British Shipping, 1870–1919 (Manchester University Press).
35. See fn 29.
36. Harlaftis, G. and Theotokas, I. (2004): op. cit.
37. There has been remarkably little research on British tramp shipping in the last 25 years with an important exception of Gordon Boyce (1995). Information, Mediation and Institutional
Development. The Rise of Large-scale Enterprise in British Shipping, 1870–1919 (Manchester University Press) and Forbes Munro, J. and Slaven, T. (2001): “Networks and Markets in Clyde Shipping: The Donaldsons and the Hogarths, 1870–1939", Business History, Vol. 43, No. 2, April, 19–50. But it has been the work of the ground-breaking maritime historian Robin Craig that has revealed the main aspects of tramp shipping. See Craig, R. (1980): The Ship. Steam Tramps and Cargo Liners, 1850–1950 (London, HMSO); (1973): “Shipowning in the South-West in its National Context, 1800–1914” in Fisher, H.E.S. and Minchinton, W.E. (eds.) Transport and Shipowning in the West country (University of Exeter); “Capital formation in Shipping”, in Higgins, J.P.P. and Pollard, S., Aspects of Capital Investment in Great Britain (1750–1850) (Methuen); (1986): “Trade and Shipping in South Wales – The Radcliffe Company, 1882–1921", in Baber, C. and Williams, L.J. (eds.) Modern South Wales: Essays in Economic History (Cardiff, University of Wales Press), pp. 171–191. Craig, Robin (2003): British Tramp Shipping, 1750–1914, Research in Maritime History No. 24, No. 3 (St John’s, International Maritime Economic History Association).
38. Lloyd’s Register of Shipping 1970.
39. For the expansion and re-invention of some of these companies see Jones, G. (2000): Merchants to Multinationals. British Trading Companies in the Nineteenth and Twentieth Centuries (Oxford, Oxford University Press).
40. Tenold S., “Norwegian Shipping in the Twentieth Century” in Fischer L.R. and Lange E., International Merchant Shipping in the Nineteenth and Twentieth Centuries. The Comparative Dimension, Research in Maritime History No. 37 (St John’s, International Maritime Economic History Association), pp. 57–77.
41. Ojala, L. (1994): “A transaction cost analysis of Finnish, Swedish and Norwegian shipping”, Maritime Policy and Management, Vol. 21, No. 4, 273–294.
42. Nordvik, H.W. (1985): “The Shipping Industries of the Scandinavian Countries, 1850–1914”, in Fischer, L.R. and Panting, G.E. (eds.) Change and Adaptation in Maritime History, the North Atlantic Fleets in the Nineteenth Century (St John’s, Newfoundland, Maritime History Group), pp.
117–148.
43. Wicken, O. (2007): “The Layers of National Innovation Systems: The Historical Evolution of the National Innovation System in Norway”, TIK Working Paper of Innovation Studies No. 20070601.
44. Johnsen, B.E. (2001): “Cooperation across the North Sea: the strategy behind the purchase of second- hand British iron and steel sailing ships by Norwegian ship owners, 1875–1925”, Paper presented in the International Conference “Maritime History: Visions of shore and sea”, Freemantle, Australia,
December.
45. Wicken, O. (2007): op. cit.
46. Tenold, S. (2000): The Shipping Crisis of the 1970s: Causes, Effects and Implications for Norwegian Shipping (Bergen, Norwegian School of Economics and Business Administration), p. 29.
47. Tenold, S. (2005): “Crisis? What crisis? The expansion of Norwegian shipping in the interwar period”, Discussion Paper 10/05 (Economic History Session, Depart ment of Economics, Norwegian School of Economics and Business Administration).
48. For an analysis of the Norwegian shipping during the crisis of the 1970s see Tenold, S. (2000): op. cit.
49. Drury, C. and Stokes, P. (1983): Ship Finance: The Credit Crisis – Can the Debt/ Equity Balance be Restored? (London, Lloyd’s of London Press), p. 37.
50. Ostensjo, P. (1992): A Competitive Norway: Chemical Shipping (Bergen, SNF, NHH).
51. Stokseth, B. (1992): A Competitive Norway: Open-Hatch Bulk Shipping (Bergen, SNF, NHH).
52. Jenssen, J.I. (2003): “Innovation, Capabilities and Competitive Advantage in Norwegian Shipping”, Maritime Policy and Management, Vol. 30, No. 2, 93–106.
53. Solberg, C.A. (2001): “Market information and the role of networks in international markets”, IMP 2001 (Norwegian School of Management BI).
54. Ojala, L. (1994): op. cit.
55. Bland, A.L. and Crowdy, M. (1961): Wilh. Wilhelmsen, 1861–1961. The Firm and the Fleet (Kendal, World Ship Society).
56. Wil. Wilhelmsen ASA, Annual Report 2000.
57. Wil. Wilhelmsen ASA, Annual Report 2008.
58. For more on the Odfjell’s history, see Thowsen, A. and Tenold, S. (2006): Odfjell – The History of a Shipping Company (Bergen, Odfjell ASA); Tenold S. (2006): “Steaming ahead with stainless steel – Odfjell’s expansion in the chemical tanker market 1960–75”, International Journal of Maritime History, Vol. XVIII, No. 1, 179–198.
59. Tenold, S. (2008): “So nice in niches – Specialization strategies in Norwegian Shipping, 1960–1977”, Fifth International Conference of Maritime History, University of Greenwich.
60. Trygve, S. (2000): “Entry barriers and concentration in chemical shipping”, SNF Report No 07/00 (Bergen, Foundation for Research in Economics and Business Administration).
61. Odjfell (2008): Annual Report 2008 (Bergen).
62. Naess, E.D. (1977): Autobiography of a Shipping Man (Colchester) (1990): “61 Years in the Shipping Business”, in Strandenes, S.P., Svendsen, A.S. and Wergeland, T. (eds.) Shipping Strategies and Bulk Shipping in the 1990s (Institute for Shipping Research, Center for International Business), p. 1.
63. Tenold, S. (2000): op. cit., p. 15.
64. Op. cit., pp. 231–2.
65. Tenold, S. (2001): “The harder they come … Hilmar Reksten from boom to bankruptcy”, The Northern Mariner, Vol. XI, No. 3, 41–53.
66. Benito, G.R.G., Berger, E., de la Forest, M. and Shum, J. (2003): “A cluster analysis of the maritime sector in Norway”, International Journal of Transport Management, Vol. 1, No. 4, 203–215.
67. For an English-speaking bibliography on Greek shipping, see Metaxas, B. (1981): op. cit.; (1985): op.
cit.; Harlaftis, G. (1993): Greek Shipowners and Greece, 1945–75. From Separate Development to Mutual Interdependence (London, Athlone Press); (1996): op. cit.; Theotokas, I. (1998):
“Organisational and Managerial Patterns of Greek-Owned Shipping Enterprises and the Internationalization Process from the Interwar Period to 1990”, in Starkey, D.J. and Harlaftis, G.
(eds.) Global Markets: The Internationalization of the Sea Transport Industries since 1850, Research in Maritime History No. 14, IMEHA (St John’s, Newfoundland); Serafetinides, M., Serafetinides, G., Lambrinides, M. and Demathas, Z. (1981): “The development of Greek shipping capital and its implications for the political economy of Greece”, Cambridge Journal of Economics, September; Carvounis, C. (1979): op. cit.; Grammenos, C.T. and Choi, J.C. (1999): “The Greek shipping industry: Regulatory change and evolving organizational forms”, International Studies of Management and Organization, Vol. 29, No.1, 34–52; Theotokas, I. (2007): “On Top of World Shipping: Greek Shipping Companies Organization and Management” in Pallis, A.A. (ed.) Maritime Transport: The Greek Paradigm (Elsevier); Research in Transportation Economics, Vol. 21, 63–93;
Lagoudis, I. and Theotokas, I. (2007): “The Competitive Advantage in the Greek Shipping Industry”
in Pallis, A.A (ed.) op. cit. pp. 95–120; Thanopoulou, H.A. (2007): “A Fleet for the 21st Century:
Modern Greek Shipping”, in Pallis, A.A. (ed.), op. cit., pp. 23–61; Theotokas, I. and Harlaftis, G.
(2009): Leadership in World Shipping. Greek Family Firms in International Business (Palgrave).
68. Gelina, Harlaftis, (2009): “The Greek Shipping Sector, c. 1850–2000” in Fischer L.R. and Lange E., International Merchant Shipping in the Nineteenth and Twentieth Centuries. The Comparative Dimension, Research in Maritime History No. 37 (St John’s, International Maritime Economic History Association), pp. 79–104.
69. Bibliography in English on Japanese maritime business is rather limited with the exception of its two main shipping companies. Exceptions to this rule are: Yui, T. (1985): “Introduction”, in Yui, T. and Nakagawa, K. (eds.) Business History of Shipping, Proceedings of the Fuji Conference (University of Tokyo Press); Nagakawa, K. (1985): “Japanese Shipping in the Nineteenth and Twentieth Centuries: Strategies and Organization”, in Yui, T. and Nakagawa, K. (eds.) Business History of Shipping, Proceedings of the Fuji Conference (University of Tokyo Press); Miwa, R. (1985):
“Maritime Policy in Japan: 1868–1937” in Yui, T. and Nakagawa, K. (eds.) Business History of Shipping, Proceedings of the Fuji Conference (University of Tokyo Press). Otherwise there is extensive bibliography on the leading companies. See Wray, W.D. (1984): Mitsubishi and the NYK, 1870–1914: Business Strategy in the Japanese Shipping Industry (Cambridge, MA); (1985): “NYK and the Commercial Diplomacy of the Far Eastern Freight Conference, 1896–1956” in Yui, T. and Nakagawa, K. (eds.) Business History of Shipping, Proceedings of the Fuji Conference (University of Tokyo Press); (1990): “The Mitsui Fight”, in Fischer L.E. and Nordvik, H. Shipping & Trade 1750–1950 (Lofthouse Publications); (1993): “The NYK and World War I: Patterns of discrimination in freight rates and cargo space allocation”, International Journal of Maritime History, Vol. 5, No. 1, 41–63; Goto, S. (1998): “Globalization and International Competitiveness – An Historical Perspective of Globalization of Japanese Merchant Shipping” in Starkey, D.J. and Harlaftis, G. (eds.), Global Markets: The Internationalization of the Sea Transport Industries since 1850, Research in Maritime History No. 14, IMEHA (St John’s, Newfoundland); On shipbuilding, Chida, T. and Davies, P.N. (1990): The Japanese Shipping and Shipbuilding Industries. A History of their Modern Growth (London, The Athlone Press). Is invaluable.
70. Wray, W.D. (2005): “Nodes in the Global Webs of Japanese Shipping”, Business History, Vol. 47, No.
1, 1–22.
71. Davies, P.N. and Katayama, K. (1999): “Aspects of Japanese shipping history”, Discussion Paper JS, 376. (Suntory and Toyota International Centres for Economics and Related Disciplines, London School of Economics and Political Science).
72. Wray, W.D. (2005): op. cit.
73. Davies, P.N. and Katayama, K. (1999): op. cit.
74. Wray, W.D. (2005): op. cit.
75. Wray, W. (2000): “Opportunity vs Control: The Diplomacy of Japanese Shipping in the First World War”, in Kennedy, G. (ed.), The Merchant Marine in International Affairs, 1850–1950 (London, Frank Cass), pp 59–83, p. 60.
76. See Wray, W.D. (2000): op. cit.
77. Nagakawa, K. (1985): “Japanese Shipping in the Nineteenth and Twentieth Centuries: Strategies and Organization”, in Yui, T. and Nakagawa, K. (eds.), Business History of Shipping, Proceedings of the Fuji Conference (Tokyo, University of Tokyo Press), p. 5.
78. Wray, W.D. (2005): op. cit.
79. Japan Business History Institute (1985): The First Century of Mitsui OSK Lines Ltd (Osaka).
80. Along with factors such as the role of other factors, such as the governmental policies, the related and supporting industries, the firm strategy, structure and rivalry. See Porter, M. (1990): The Competitive Advantage of Nations (London, Mcmillan).
81. JSA (2004): The Current State of Japanese Shipping, Japanese Shipowners’ Association.
82. The dependency of shipbuilding and steel industry by the shipping industry is obvious: In the period of its apogee the shipbuilding industry absorbed 35% of steel output. See Bunker, S.G. and Ciccantell, P.S. (1995): “Restructuring markets, reorganizing nature: An examination of Japanese strategies for access to raw materials”, Journal of World Systems Research, Vol. 1, No. 3, 1–63.
83. See Stopford, M. (1997), op. cit.
Chapter 2
Globalisation — the Maritime Nexus
Jan Hoffmann* and Shashi Kumar†