Justification of stability ranges of commercially reasonable, allowable loss-making and crisis operation of the vessel
DOI:
https://doi.org/10.15587/1729-4061.2015.55007Keywords:
vessel, vessel loading, loss-making operation of vessel, stability rangeAbstract
In the period of unfavorable conditions of the freight market, where the vessel operates with zero or negative profit, the Owner can lay up the vessel or continue its operation. The decision on the vessel withdrawal from operation is usually made based on the results of the CVP analysis («costs-volume-profit»). It is not always justified. The reason is the presence of expenses, accounting of which is not provided by either the CVP analysis or the provisions on the justification of indicators of commercially reasonable operation of the vessel. As a result, the Owner's expenses, related to the operating reserve or cold stack of the vessel may be significant, compared to losses accompanying the continuation of inefficient operation of the vessel. In turn, when deciding on the continuation of loss-making operation of the vessel, the Owner should understand that this cannot last indefinitely, despite the desire to maintain the market share. Consequently, the Owner should be guided by certain operating and financial indicators. At the same time, it is evident that all these indicators characterizing the ineffective operation of the vessel are in the loss-making zone. It was considered in detail in the research. As a result, the zones of allowable loss-making and crisis vessel loading, allowable and crisis loss were identified. The corresponding indicators were proposed, justified and formalized. The ranges of stable commercially reasonable, allowable loss-making and crisis operation of the vessel in terms of indicators of loading, income and expenses were determined.References
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