which hopefully means a new US flagged vessel! The job is to move ammo through the Pacific for 120days minimum with two 120day options for an award amount of $4.4M which works out to $33000/day. The contract gave preference to a US flagged vessel over a foreign one which was nice to see published! If the ship they proposed is priced low enough, they stand to be able to pay for it in just a year if they get both options.
This is an attractive business. Especially, if one could raise enough capital to start out with a well designed, built and maintained ship not over about 7 years old. The only complicated part of this business is learning how to bid competitively and profitably. The government is throwing big money at these guys. It’s a small business set aside, so the big boys like Maersk cannot bid on it.
especially if the Navy is actually honor the law that gives US flag vessels preference to carry DoD cargoes even if it ends up costing them more money to do so! if 100% military cargo was carried on US flagged vessels I would not be surprised if 25 to 30 more ships would be necessary in the US fleet all of which would be very militarily useful in a sealift. plus all the additional US citizen mariners added to the pool of available crews for the RRF and MSC surge sealift fleets if there was the need for a massive breakout like 1990. This is a win/win for MSC as long as their bean counters aren’t allowed to whine. I am very encouraged with this contract and will be looking for more of them coming out.
regarding finding the capital, when DoD cargoes are guaranteed to US vessels, I would imagine finding that money won’t be hard especially if the contracts are not of too short a duration like this one.
If one had a very firm grip on the bidding, and small business set aside, aspect of this government charter business, it would be easy to attract capital to buy and reflag good ship(s).
Basically, you’d need to either have the skills personally, or have the money to hire top bidding talent and build a good sales team first.
If you could spend a little more money (probably twice as much) to buy ships that are newer, better built, more reliable, a little bigger, and a little faster, that would be one hell of a competitive advantage.
Very ripe market with little competition. Unlike building machines, or structures (for which there is tons of small business/disable vet/minority owned competing), shipping is a different animal that hasn’t fully introduced to these normal government giveaways. Additionally, very few ex-military officers with the connections know anything about real shipping (operations and/or business side) since there is a HUGE difference between .mil shipping and commercial shipping.
The EOT Spar is now Vanuatu flagged Midnight Czar. Let’s face it, the ship was built in 1990. She will soon be due for her next special survey and the expense that goes along with that. Their new addition of similar design, SLNC York (ex-EIT Paloma) was built in 2010.