Page 10: of Maritime Reporter Magazine (September 2012)

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Most anyone who has seen Clay Mait- land address a crowd; watched him grill a conference panel; or taken him one-on- one in conversation to discuss some nu- ance of the industry, probably knows that he is intelligent, quick of wit and opin-ion, never shy to express his beliefs nor offer quarter in blunt assessment of the maritime industry?s leadership. He is literally ?the man about town,?seemingly two places at once and serving a dizzying number of roles, from his dayjob as a managing partner in InternationalRegistries, Inc. ? which administers the Marshall Islands Ship Registry and the third largest in the world ? to his various philanthropic endeavors and associations, including: Director of the Coast GuardFoundation; Member of the American Bureau of Shipping, and of the NationalCargo Bureau; Founding Chairman of the North American Maritime Environment Protection Association (NAMEPA), and Chairman of the North American Mar- itime Ministry Association (NAMMA) Industry Advisory Board. Above all Maitland ? who emigrated to the U.S.from England in 1947 with his motheraboard the Queen Elizabeth and is a grad-uate of SUNY Maritime ? is passionateproponent on maritime matters; passion-ate about spreading his thoughts in amanner that ? while he admits may notalways be right, are intent on bringing to light the industry?s strengths and weak- nesses to help create a safer, more effi- cient and sustainable maritime industry. Leadership (or lack there of) Many of the problems facing the mar- itime industry are not unique, as a stag-nate global economy and the burden of meddlesome regulation saps the re- sources of most every industry. Most problematic however, according to Mait- land, is a vacuum in leadership in politi- cal circles, in the board room, and even at trade association groups; a dearth ofleadership that is willing and/or able tostand up and sing the industry?s praises or debate the industry?s problems. ?I think we all need to be more outspo-ken,? said Maitland. ?This is the story of the industry; it is bean counters, beancounters and more bean counters (In fact Maitland had his own word for it: ?Bean-Counter-itis?). What do you have to do to turn it around? First of all you have to get people in the industry who know something about it. They do exist.? In the U.S., Maitland reckons leader- ship woes start with what he views as the systematic degradation ? many have called it the disappearance ? of the U.S.Maritime Administration. ?You?ve got a guy that came out of Capitol Hill wherehe was a railroad regulation guy working for Frank Lautenberg in NJ; that?s your Maritime Administrator. Can we please get somebody who knows something about the business? Sean Connaughton was the last one we had who had that.? ?The people who know about the in- dustry, who know the culture ? they don?t seem to get promoted,? Maitland continued. ?Instead we have accountants, bankers and people from the Hill. Essen- tially you?ve got nobody out there who is really fighting for the U.S. merchant ma- rine; nobody is fighting to save Kings Point other than Kings Point alumni.? While some of the problem is a lack ofinterest and knowledge on maritime mat- ters in general, Maitland is quick to pointout that there are several bright minds and verbal advocates of maritime matters in government. ?(In Washington) you?ve got some fairly able people ; they?re just not interested in us, in fact they?re not in- terested in transportation. Congress hasnot become less competent, just more po-larized.? On the corporate level, Maitland counts ?BeanCounter-itis?as a cause forpotential mishap. ?A good example is Deepwater Horizon. Although it was a blowout (some of my friends said ?it?s not a ship? ? of course a rig is a ship), it was due to complacency. BP is now at about $40 billion ? that?s $40 billion with a ?B? ? in cost, expenses, fines, charges, legal fees, etc. This is only one instance, but across the industry a lot of the deci- sions on the budget are made by finance people. They are very smart, but they are not risk managers,? said Maitland. The Technical Solution Addressing an onerous level of new rules and regulations which mandate the types of equipment that outfit a ship ? from the bridge to the engine room andevery space in between, is an acute prob- lem for many shipowners, particularly in today?s down market where freight rates are already creating a cash crunch.?If freight rates continue to be as de-pressed as they are now, the question is how long can the industry sustain the reg- ulatory burden, deal with the overall cost burden ? and I don?t have an answer to that. It?s a balance sheet problem. I do think there are going a lot of mergers and acquisitions; there?s will be continued scrapping. I think the industry is going tobe a smaller industry,? Maitland said. The industry today is a far safer than the one he entered in the mid- 1970s, atime when new tankers were blowing up due to tank cleaning mishaps, and bulk carrier break up and losses were morecommon. ?I think technology is giving us a handle on what a ship does and where itis, that we did not have a generation ago,? Maitland said. But technology alone isnot the silver bullet, and in fact in some instances, such as the emerging regula- tions regarding Ballast Water Treatment Systems, for example, which has been tagged as the biggest and most costly refit program in the industry?s history, the leg- islation has actually jumped far ahead of the technology. ?In the case of ballast water ? the technology has not kept pace with the regulations, particularly on the state level. So there we have a problem that has no visible solution yet, and Ithink we?re going to end up with a con- vention that we cannot enforce.? ?Costs are going up, margins are going down, how do we stay in business, how do we maintain and improve our safety record? The answer is: in many cases we?re not going to be able to, and many companies are going to go out of thebusiness. It?s just like Aviation. You?ve seen a constant consolidation. I thinkthat?s going to happen in commercial shipping too.? CONVERSATION WITH CLAY Shipping Insight & Fleet OptimizationFleet Optimization, the focus of the inaugural Shipping Insightset to take placeOctober 8-10, 2012, in Stamford, Conn., is a term that can mean many things to many people. Clay Maitland will deliver the Keynote address the morning of Octo- ber 9, so we thought we?d get his take on the meaning. ?Shipping today is one of thesafest, if not the safest carrier systems and supply chain in the world, which certainly was not the case when I started in this business,? said Maitland. ?When I joined this company (International Registries) in 1976 we had a lot of problems that don?t exist today.? When I think of Fleet Optimization, I ask: ?Do we have the ships that wewant, for the trades that we service. An ore carrier should be an ore carrier, and designed for the cargo it is to carry. A lot of ships were built on a specu- lative basis to make money. Many ships are owned by investors ? perfectly honest investors ? that hire ship managers; many of them good, some of them not so good. If you?re going to optimize your fleet in terms of the life of the ship, the use of the ship, the safety of the ship, the ship has to be purposebuilt ? and today they are not.? Shipping Insight features Clay and an ?A-List? of more than 30 industry experts. 10Maritime Reporter & Engineering News The Voice Clay Maitland is a ubiquitous figure in the global shipping circuit, never shy to share his accrued maritime experience of more than 40 years, ask the tough questions or supplythe blunt opinion. Set to celebratehis 70th birthday later this year butnot slowing a step, Maritime Re-porter & Engineering Newscaughtup with Maitland in his Manhattanoffice late last month. by Greg Trauthwein Clay Maitland is a ubiquitous figure in the global shipping circuit, nevershy to share his accrued maritime experience of more than 40 years, ask the tough questions or supplythe blunt opinion. Set to celebratehis 70th birthday later this year butnot slowing a step, Maritime Re-porter & Engineering Newscaughtup with Maitland in his Manhattanoffice late last month. by Greg Trauthwein The Voice MR#9 (10-17):MR Template 9/13/2012 9:46 AM Page 10

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