In an exclusive final interview before the Wärtsilä merger was announced, Frank Coles, chief executive of Transas, spoke to Craig Jallal about how scale is a key factor in changing the mindset of the shipping industry.
The theme at this year’s Connecticut Maritime Association (CMA) conference is change, and for some people, change cannot come fast enough. One of those people is Frank Coles, ex-seafarer and chief executive of Transas, a supplier of software solutions for navigation, fleet operations, training and ship traffic control.
But it is not the world of vessel electronics that Mr Coles wants changing, it is the mind-set of the whole shipping industry.
“If Elon Musk arrived and sat in on a session of the IMO, he would think it was something out of a Dickens novel,” he told the audience at CMA. This talk was a cut-down version of theTED-style talk he gave at a recent Transas event in Vancouver.
In an exclusive interview with Tanker Shipping & Trade, Mr Coles expanded on the theme of change and his version of a new world of shipping.
His view of IMO is uncompromising. He doesn’t blame IMO per se for being anachronistic, but faults the system of multiple committees where nation states slow down and compromise the decision-making process with their own special interests. So what body, suitable for today’s shipping realities, would replace IMO in Mr Coles' opinion?
“The first thing is to have a clear set of objectives,” he said. “I believe we should have a panel comprising a number of shipowners, the regulators, such as class, who come up with what good looks like.” The aim of the panel would be to set the bar for safety and performance. To meet the performance criteria, the panel would include shippers. In his speech earlier in the day, Mr Coles pointed out that Amazon is dictating to shipping companies when the containers, and hence the ship, has to arrive on berth. “I believe shippers are going to drive the agenda in the future,” said Mr Coles.
Would this replace other bodies, like Intertanko? No, he has a high regard for Intertanko. What he is aiming for is to set a standard. “Only those who have reached the standard can participate. So what if it means there were only five yards that can make product tankers to the required level of reliability? It will eliminate the least common denominator, that unwillingness to offend, which gives the poor quality goods and services an entry into the market.”
Transas, which provides vessel tracking equipment for traffic separation schemes, has started this movement through a process of aggregating and sharing high-value data. There is a trial commencing in January 2019 with two shipping companies that Mr Coles will not name, but in his words “see change coming, and want to build efficiencies in their operation”.
In the trial, Transas will provide complete vessel tracking data, integrated into the bridge systems, and connected to the auto pilot. The ships will effectively steer themselves. The master will still be in charge, using the integrated system as a decision support tool. The aim is to provide a safe, environmentally friendly operation. The companies taking part in the trial are aiming to make incremental gains in operational efficiencies.
Mr Cole cited the case of Carnival Cruise Line, which doesn’t use Transas equipment, as having full-scale operational centres which track their ships to the second. If a ship is likely to miss its ETA, the operational centre is equipped to make new arrangements for the passengers’ onward transit, taking the burden off the crew.
“But you don’t have to be a cruise line, you need to be thinking about a safer, more environmentally friendly way of delivering cargoes.” As we heard from Thome, these operational hubs require a huge investment, not only in equipment, but in personnel. There are economies of scale in providing the service to a large number of ships. Mr Coles sees this going even further, “I expect we will see super-shipmanagement companies, operating a wide range of ships on behalf of the leasing companies.”
It is certainly a bold vision, but one that may have been made more probable by events that unfolded days after Mr Coles' speech at CMA.
The acquisition of Transas by Wärtsilä in a deal worth €210M provides the digital platform and scale Mr Coles has been advocating. Wärtsilä Marine Solutions president Roger Holm said his company will connect its own bridge systems, condition monitoring, power generation and other dynamic technologies with Transas’ ship traffic control, simulators, and e-navigation solutions.