A new study from Dynamar, "Deepsea Ro/Ro Shipping (2014),
" of the roll-on/roll-off shipping business, found that while the conventional deepsea ro/ro fleet is contracting, the vehicle carrier fleet -- pure car carriers (PCCs) or pure car truck carriers (PCTCs) -- is growing.
Conventional ro/ro ships often have the ability to carry containers or breakbulk cargo, while PCCs and PCTCs are specialized vessels created for the trade in vehicles.
Originally created to move automobiles from Japan to the U.S., modern PCTCs have heavy-duty ramps and strengthened and adjustable decks so that they can carry all manner of construction and agricultural equipment, as well as breakbulk items. Dynamar noted, “For some of the PCTC operators, other-than-car cargoes make up for up to 50 percent of their overall income."
Over the past five years, Dynamar found that 48 new conventional ro/ro ships were built and 146 scrapped. Currently, it said, there are 324 conventional ro/ro ships in the world fleet today and 22 on order. The five leading operators are Grimaldi and its subsidiary Atlantic Container Line; Wallenius Wilhelmsen Logistics; NYK Bulk and Projects; Messina; and Eastern Car Liner.
In contrast, 228 PCCs or PCTCs were built and 187 scrapped during the same five-year period. Today, it said, there are 776 vehicle carriers and 67 on order.
Dynamar said the “workhorse” size for vehicle carrier ships in the intercontinental trade is about 6,500 “car equivalent units” or CEUs. (The CEU is based on the size of the 1966 Toyota Corona RT43, according to Jürgen Sorgenfrei’s book "Port Business.")
It noted that there are orders for 35 ships with capacity of 7,000 CEUs or more, and at least eight with capacity of more than 8,000 CEUs. Some of these new ships will be too large to pass through the present Panama Canal.
Leading operators of PCCs and PCTCs include Wallenius Wilhemsen, MOL, NYK, “K” Line and Hoegh Autoliners. Those five companies have a 73-percent share of the PCC/PCTC fleet.
Dynamar also noted that the average age of the PCC/PCTC fleet is 11 years, much lower than the average 18 years in the conventional, deepsea ro/ro fleet.
The existing fleet of vehicle carriers had space for 3.7 million CEUs at the start of 2014.
Dynamar said that during the 2009 financial crisis, global car markets collapsed, export markets from Japan fell by 30 percent and many PCCs and PCTCs were put into layup or scrapped. As a result, even with newbuilding in recent years, it said, “carrying capacity has overall become tight. Demand in the U.S. and Europe with their improving economies is increasing, further fueled by China’s growing middle class.”
In the conventional deepsea ro/ro market, Dynamar noted the breakbulk market is assumed to recover this year from an unexpected poor year in 2013.
Dynamar added that investment in conventional ro/ro newbuildings “peaked in the late 1970s, as the concept was also considered ideal for the Europe-Middle East and West Africa markets, among others, which were going through an infrastructure development boom. Port facilities there then were limited, causing congestion running into weeks, if not much longer, for general cargo ships.”
Because of ro/ro ships' ability to simply drop a ramp to load and discharge cargo, Dynamar noted that they do not need extensive shore-side handling facilities, adding that this made them “the ideal ship for serving the developing world.”
Many conventional ro/ro ships also have the ability to handle container cargo, and remain popular with some operators.