1^st principle: Keep, at all times, the digital way, company’s cost below the prevailing freight rate

2^nd principle: always manage the big items of cost, by priority, & then go down the list

3^rd principle “Stretch one’s feet so that to be covered by one’s quilt”

Know that a certain important cost item is capital, which determines also depreciation

Onassis showed that the real fast growth of a company is by using other people’s money, through banks!

Shipowners became victims of the optimism created by…their new buildings!

No one can guarantee that a prosper situation will continue for the entire life (15 - 20 years) of a newly-built vessel

Traditional Greek shipowners as a rule- & for a quite long time- did not order newly-built ships, & those who did, they were called “adventurers”. This rule violated by Onassis

Onassis, before the 2^nd World War, in 1938, made the assumption that the demand for oil will be continuous & rising, & he built tankers embodying the maximum economies of scale, allowed by shipbuilders & his persistence. He proved to be right, but for a time, till end-1973. Onassis, however, proved right in his above assumption, till Arabs put an end for a cheap- & abundant-oil forever; gas destined to follow

Onassis broke the principle of the traditional Greek shipowners, which was to “use past profits to buy a 2^nd hand ship, and get no loan”. So, the traditional growth of companies was slow, given also the cyclical character of the industry. As he died early in 1975, we do not know what he could do during the tanker crisis… Niarchos, however, being 13 years younger than Onassis, experienced & faced the tanker crisis (Goulielmos, 2021e) the hard way by reducing his crew wages by 20%

When freight rates fall, a GPS will try to charter its ships in time charters, before this happens. E.g., in 1976 for 3 years; in 1981 for 6 years; in 1997 for 3 years; and in 2002 for 2 years! While the time charter rate is lower than the spot one, when market rises, and difficult to obtain a time charter for long periods, it nevertheless protects the company from the very low future spot rates. Moreover, it protects the company from sudden increases in bunkers’ cost (bunkers are payable by the Charterer in time charters)

The shipping pattern suggests a specific policy, meaning to put aside part of the good earnings for a rainy day. In PS case-study we could keep $421m, (calculated from the PS earnings above $40m), so that to face-out/fill the lower earnings at other times!