Shifting tides: Why modern charterers are moving beyond performance claims

Shifting Tides: Why modern charterers are moving beyond performance claims

Over the last few months, we noticed a slow but steady shift in how leading charterers manage vessel performance. The traditional approach of filing performance claims against shipowners for underperformance is giving way to a more sophisticated, intelligence-driven strategy.

The problem with the traditional performance claims approach is clear: they often result in prolonged disputes over weather conditions and Charter Party interpretations, leading to costly legal battles where fees frequently exceed potential recoveries. Moreover, this adversarial approach does nothing to improve future fleet performance.

Building long-term value

Instead, forward-thinking charterers are now investing in comprehensive performance intelligence throughout their chartering cycle. The financial logic is compelling: operating a typical dry bulk vessel costs around $5 million annually. While a 1% performance improvement yields $50,000 in annual gains, sophisticated vessel selection and monitoring can achieve improvements of 3-7%, generating up to $200,000 per vessel annually.

The impact becomes even more significant when considering the industry's traditional use of "abouts" in performance assessments. These margins create a substantial blind spot, amounting to over $150,000 in annual value per vessel at current market rates. Two sister vessels can both comply with Charter Party terms while delivering radically different commercial results.

Modern performance monitoring technologies, particularly Digital Twin solutions like developed by We4Sea, have revolutionized this approach. These tools enable continuous performance monitoring in all weather conditions, help identify performance trends early, facilitate data-driven vessel selection, and enable fact-based discussions with owners about optimization opportunities.

This intelligence-driven approach transforms conversations with shipowners from contentious disputes into constructive dialogues. Instead of filing claims months after problems have occurred, charterers can present objective, weather-normalized data to address issues proactively.

Some charterers are seeing commercial improvements of up to 5% - representing approximately $200,000 in additional annual value per vessel.

From Claims to Intelligence

We believe the future of maritime performance management lies not in just pursuing claims but in building institutional knowledge and intelligence.

By focusing on sophisticated pre-fixture vessel selection, continuous monitoring, and performance evaluation, charterers can optimize their operations while developing stronger partnerships with high-performing vesselowners.

In today's competitive maritime landscape, the winning bed is to invest in understanding, optimizing and institutionalize performance management, and not just focus on filing performance claims.

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