SHIPPING LOSSES

Evening Post, Volume CXXXI, Issue 31, 6 February 1941, Page 5

SHIPPING LOSSES

REPLACING TONNAGE

POST-WAR PROBLEM

COSTS RISE STEEPLY

Among the many problems with which British shipping would be faced after the war would be its re-estab-lishment in foreign trades from which withdrawal had been necessary in order to meet the immediate requirements of the nation, said Sir William Currie Crawford, chairman of the Peninsular and Oriental Steam Navigation Co., at the annual meeting in London. From an economic point of view, the resumption of these services with a minimum of delay was imperative and, in certain circumstances, it might even be necessary to invoke Government assistance. Another grave matter was the replacement of ships which had either been lost or become uneconomic to operate on account of age. Shipbuilders throughout the country were at present fully engaged on Admiralty and Ministry of Shipping work, and consequently it was not possible for them to accept orders for ships of the type suitable for the company's trades. With a view, however, to' obtaining a line on prices now ruling, the board had made inquiries regarding the cost of a repeat of a passenger vessel ordered in April, 1939. and the figures submitted showed an increase of 37 per cent. After the war, new tonnage obviously would be unobtainable at anything like the prices at which existing ships were secured. This went to prove that a 5 per cent, depreciation charge on original cost of ships was in itself insufficient to take care of a future replacement programme, and as nothing had been allowed by the Government for this purpose in rates of hire, the desirability of strengthening the position by allocating sums to replacement reserve from time to time as opportunity offered would be appreciated. Already differences between book values of vessels lost and recoveries under war risk insurance had been credited to "tonnage replacement reserve." All the companies within the group had adopted a similar policy.