Managing Shipping Companies, the Way Their Pioneer Managers Did: The Case-Study of Stavros Niarchos, 1909-1996

Present, and future, managers of shipping companies have a lot to learn from their past colleagues. Students of the shipping industry always ask: How did Niarchos build such a fortune so as to leave $400 m upon his death? This is a third paper, presenting the business life of the late shipowner Stavros Niarchos, another “golden” Greek. He conceived the value of vertical integration in business, first applied by the Japanese. He established a ship-owning company, a shipyard, and a steel mill. In 1974, Niarchos owned 64 ships of 4.4 m GRT. This not only made him a top shipowner, but also master of an entire business environment, focusing on the tanker market. Shipping, being an international industry, was the victim of many major political events, and Niarchos, born in 1909, was a victim of the same events. Niarchos pursued economies of scale. Niarchos did not come from an Aegean Islands, which were the birthplace of many shipowners. Fifty Greek shipowners came from Chios and Aignouses. While Onassis failed as a father, Niarchos failed as a husband, marrying six wives, five women, and his tankers making the sixth.


Introduction
Shipping is an important service industry, linking the lands of production with the places of consumption, constructing bridges between oceans and between exporting and importing countries. Sometimes the industry grows, and at others it is subject to recessions/depressions, following roughly eight-year cycles historically. A manager has to be prepared and educated to manage in a cyclical and volatile industry. It has been an aim in almost all of our papers to educate future managers, because maritime prediction is not possible, but volatility creates great opportunities.
The course of the world fleet, in GRT, for 51 years, is shown in Figure 1. Table 1 summarizes the relevant developments. The global financial crisis from the end of 2008 lasted more than 8 years (to 2019), followed by COVID-19 Pandemic (to 2021), completed the decline of the shipping industry. Certain further events have taken place as shown in Table 2.
Ocean-going shipping plays an important role in global sea trade, and is frequently a victim of political actions, including canal closures, local wars and increases in oil prices! The industry has also made its own mistakes, by ordering ships that proved not to be needed. But this is what one expects from an industry where prediction is not possible. Shipowners feel a recession and a depression when their incoming money diminishes.  GRT, 1950-2001 data from "OECD Maritime Transport", various years.

Aim and Organization of the Paper
The aim of this paper is to present the business life of a past pioneer shipowner-manager-and display his strategies to help prospective shipping managers gain some useful lessons and insights. This paper aims to educate interested persons about what they face in the real shipping business, as Niarchos has done.
The paper is organized first in a literature review, followed by four numbered parts. Part I, deals with the important concept of elasticity of demand. Part II deals with the situation prevailing in the international market for tankers, from 1957 to 2008. Part III, addresses the economies of scale and other issues in the shipping sector. Part IV describes Stavros Niarchos' business life, 1909-1996.
The paper ends with conclusions.

Literature Review
The shipping industry is poor at analyzing the strategies of its own managers in either articles or books. The exception is Onassis, who is the subject of about 10 books. This is because Greek shipowners prefer to work in the shadows, unnoticed, so as to avoid envy. Only journalists have published a number of books about the lives of shipowners, mainly based on interviews. They will be used as sources here. The Greek shipping journalist, Mpatis (1999), wrote about 43 people who have played an important role in Greek shipping, of whom 37 were shipowners, between 1957 and 1990. Stopford (2009: p. 3) also wrote that, "the great shipping boom of 2004 swept the industry from rags to riches in little more than a year, making its fortunate investors some of the wealthiest people in the world. This sort of volatility created superstars, like Niarchos".
The so called "independents" in oil transport were shipowners of a new generation, descendants of the tramp operators, who had served the liner companies for the previous 100 years, supplemented by a new generation of businessmen   and sold each week. Both sellers and buyers think they are doing the right thing.
But both cannot be right.
In shipping, to gain an advantage over one's competitors 3 , one has to: 1) pay less for ships, 2) pay less for operation, and 3) pay less for capital (Lesson 4). A "shipowner-to-be" must realize that he/she can buy the greater part of a ship with other people's money, a practice first employed by Onassis (Goulielmos, 2021a(Goulielmos, , 2021b. The Financial Times once noted: "The unexpected surge in the demand for industrial goods that resulted from China joining the WTO -world trade organization, in 2002, resulted in the world being caught short on ships". Low-valued goods have no alternative way to be transported in bulk, except by using ships, and the tentative imbalance in the supply of ships and the demand for them, may send shippers searching for ships (Lesson 5) ( Figure 3). The demand for ships and the supply of them determine the reward paid to ships (the freight rate), and her value (price). Given that there are about 33,000 shipowners globally owning 100,000 4 ships, the situation approximates to pure competition in supplying ships for sale or chartering. Their price can settle anywhere on the Cartesian diagram of supply and demand, either very high or at rock bottom.
The Economist once wrote that, due to economies of scale, even a tripling of charter rates would not add much to the price of goods transported. This can be explained by the fact that the goods transported by ships are low-valued and their freight rate is a small percentage of their price, perhaps 10% on average. In fact, the liner cartels, called "conferences", determined their freight rates so that they did not increase CIF prices 5 (prices at the destination) beyond a level allowed by the elasticity of demand. Otherwise, they might have priced-exports -out of the market, and thus out of any transport. Shipowners do not want this.
In 1975, OPEC, by increasing the price of oil, dramatically reduced the demand for oil, as shown in Figure 8. When shipowners have plenty of cash, they place orders (Lesson 6). Sometimes, however, the new ships are not needed. The bankruptcy of Lehman Brothers damaged sea trade, because it led to the collapse of inter-bank letters of credit, which are the lubricant of international ocean 3 A ship owner who has to move their own goods may charter out their own ships and then charter-in other ships cheaper. 4 At the end of February 2021, Clarkson's Research announced that world fleet reached 100,000 ships. Of those, 25% were eco-friendly and 20% are fitted with a scrubber avoiding the air pollution. 5 The CIF price equals the FOB price (free on board) increased by insurance and transport cost. Assume that oil is priced $100/b at the departure port (FOB), and sea transport cost is $10/b and insurance cost $5/b, so, CIF 1 is $115. Suppose that the freight rate now rises to $40, CIF 2 will increase to $145. Suppose next that the demand for oil at destination falls 30%, say from 13,000b/day to 9100, due to this increase in price. The arc Elasticity of demand is: Q 1 − Q 2 /Q 1 + Q 2 * P 1 + P 2 /P 1 − P 2 {1} and so: e = 1.53, which is greater than 1. This elastic demand does not suit shipowners, because the supposed increase in price by $40/b, reduced the quantity demanded (and transported) by 3900b/day. Less work for the ships. As a result, the shipowners arranged for oil to pay a freight rate of only $15, instead of $40. The quantity demanded in this case fell from 13,000b/day to only 12,900, giving an e = 0.18, which is less than 1, and inelastic. As a result, the quantity transported fell by 100b/day instead of 3900, and the loss fell from $39,000 per day to $1500 per day. A great improvement. The conclusion from the above exercise is that first calculate the elasticity of demand of the good to be transported, then determine the freight rate such as not to cut it from consumption at destination meaning also exclusion from transport! shipping.
It was reported in Marine Money that the shipowner Jim Tische 6 bought a fleet of new ships at scrap prices, and … parked them until the market recovered and thus made a fortune by selling them. The lesson from this is that one should buy ships at rock bottom prices, and if market does not recover, to lay-them -up until it does. In fact, it is possible to calculate the benefit of lower prices in terms of the cost and the time of laying up ships and freight rates and values.
All great shipowners did focus on issues like where to build ships and why, and where to borrow money from and how (lesson 7), like Onassis and Niarchos. German banks e.g., were exposed to the sector of containerships, and to US sub-prime mortgages, thus having an urgent need for cash. From Hamburg, 35% of the global containership fleet was controlled, due to a favorable tax treatment and low-cost loans. At that time (2009) 50% of shipping loans were in default, according to financial news.
There was a case where a ship valued at $56 m in 2007, bought with a bank loan of $43 m or 77%, was valued in 2009 at less than $25 m. The borrower had to pay the remaining $40 m. If the bank foreclosed on the loan, and took title to the ship, it would have to auction the ship, pay-out any unpaid creditors (for example for fuel, which might be $3 m bill), suffering at the end a loss of about $18 m. The lending bank decided instead, in a such situation, to give the ship to other ship owning clients, lending them the required working capital 7 until the market recovers. In this way the bank reduced its losses. Even if the shipping crisis would last 10 years, the loss of the bank would only be $13.3 m 8 which is less than $18 m otherwise.
Summarizing, important maritime lessons can be taken from the 17 shipping managers interviewed by the shipping journalist: McCleery in 2012. Seven basic shipping lessons were important from the period 2009 to 2013. Though maritime history may not repeat itself, past lessons have to be remembered and compared with present or future conditions, so that managers to be prepared (Goulielmos, 2009).

Part I: The Concept of the Elasticity of Demand
An economic law applied, when the main oil producers more than tripled its price, in 1979. The law states that when the price of a commodity increases, the quantity demanded is reduced, given its elasticity of demand. Traditional economists did not expect the quantity of oil demanded to fall, as they assumed it to be highly inelastic. They were right apart from 1975. The price elasticity of demand is a very important tool for shipping, because, when freight rate increases, and results in a rise in the CIF price, it is possible to calculate the drop in demand, and also the drop in revenue for the shipowner (Revenue = Freight rate * Quantity transported {2}) (Besanko et al., 2013: pp. 9-10). 6 CEO of Loews Corporation-a New York City based investor. 7 This covered the first 3 chapters of McCleery's book. 8 On the assumption that this vessel will cost $2.55 m per year in expenses ($7000/day) and she will earn $1.22 m per annum ($3500/day) in a crisis, it will take 13.5 years to lose $18 m. The elasticity of demand is the percentage change in the quantity demanded (dependent variable), divided by the percentage change in price, at the limit: e = dq/q:dp/p {3}, where q is the quantity demanded and p the price prevailing (Henderson & Quandt, 1958: p. 168). The elasticity of demand between two points is a more convenient tool, (called "arc e"), shown in Graph 2. It is defined as: e = q1 − q2/q1 + q2 multiplied by p1 + p2/p1 − p2 {4} (Bilas, 1967: pp. 15-23).
The demand for oil, as shown above, and also in Table 2, fell by approximately 64% (from 1.4 billion barrels to 0.9 billion) and its price approximately quadrupled, from $11/ba. to $40/ba., over a period of 4 years (1979)(1980)(1981)(1982)(1983). The total revenue of producers increased thus from $15.4b to $36b, despite the substantial increase in price, because e =− 0.04, which is less than 1.
The demand for oil fell now to almost 90 m barrels/day in 2020, or by 10 m barrels/day, due to the pandemic. In 1990, the oil trade was 32 m barrels/day ( Figure 7). The global economy is still dependent on oil, despite repeated increases in oil prices, because demand almost tripled during the last 30 years!

Part II: The International Market for Tankers, 1957-2008
Before presenting the strategies of Stavros Niarchos, we show the conditions prevailing in his main market, the tankers. Figure   This is the short name of "Worldscale tanker nominal freight scale", created in 1969 to provide an independent unit of measurement of tanker rates. Market levels of freight rates are expressed as a percentage of "scale" rates. They assume a nominal tanker function on round voyages between designated ports. The calculated schedule rate is equal to different US$/ton equivalent for each different route combination, which is the "Worldscale" 100/flat rate, meaning 100 points of 100% of the published rate. For example, W60 means 60% of the published flat rate. The scale is sensitive to bunker prices and port costs. In 1989 the "New Worldscale" appeared with a standard vessel of 75,000 tons and a daily hire of $12,000 to be used as a representative situation. For further details see: Kavussanos & Visvikis (2006).
The main findings are summarized in Table 4. As shown in Figure 3, 140 m dwt was the largest gap between tanker demand and supply, in 1983, where supply exceeded demand for the whole period, from 1980 to 1988. The gap started from 65 m dwt in 1980 and fell to 40 m in 1988.
Behind the above developments, certain events were taking place (Table 5).
In the shipping industry, a recession or a depression has specific repercussions. They lead to either lay-up of ships or to their scrapping. The lay-up of tankers, for 1983-1990, is illustrated in Figure 4.
As shown, 1984 was a crucial year, because 75 m dwt tankers were laid-up. Tankers used for storage varied from 10 m to 20 m dwt. This means that 95 m dwt of tankers were inactive due to lack of demand. Figure 5 shows the same situation for 1980-1989 presenting the tanker scrapping/delivery relationship. The global fleet of tankers will grow if a greater tonnage is on order (supply), so that deliveries exceed scrapping.
As shown, scrapping of tankers surpassed deliveries, from 1980 to 1987 inclusive. Scrapping reached a maximum of 27 m dwt in 1985. Intense scrapping can be seen from 1982 to 1985 with over 18 m dwt per year and a total of approximately 90 m dwt for the whole period. Figure 5 did not indicate the age or the size of the scrapped vessels, but they were very young and very large. There were two factors in force: 1) the higher oil prices ( Figure 6) and 2) the fall in world oil trade ( Figure 7). This is the worst combination for shipping whenever it happens.
As shown, the price of oil rose to $30 -$37/barrel (spot Brent) from 1982 to 1986 and to $20 by January 1990. In January 2017, it was about $55 and in January 2021, $52. This resulted in a fall of oil sea trade from 36 m barrels per day in 1980 to 22 m in 1983 and 23 m in 1987 (Figure 7). Then the situation improved, reaching about 32.5 m barrels per day, and 90 m by 2021.
The course of total shipping demand over 1970-1989 is shown in Figure 8. As shown, the sea oil trade (demand) was the victim of the depression/energy crises of that time (1974-5; 1979-1989). The drop in oil sea trade from 1979 to 1985 was dramatic, losing 45 units in 6 years.

Part III: Economies of Scale and Other Issues in the Shipping Sector
The issues that can be raised related to shipping management are: 1) a thorough   Iraq invades Kuwait 1990Kuwait 1957Kuwait -1990 Turbulence (Goulielmos, 2018) Source: author.

10
Closure of the Suez Canal meant that ships' distances became suddenly longer; so, a lack of ships is created pushing up freight rates. Ships had to travel round Africa to reach Persian Gulf. Later ships were made larger to face the longer distances. This happened when the Canal closed for a long time (1967)(1968)(1969)(1970)(1971)(1972)(1973)(1974)(1975). Small ships are penalized by port expenses, when they frequently visit a port. Larger ships divide all expenses including port ones in a greater number of tons, so there are economies of scale. The longer the distance, the larger the ship should be.

Part IV: The Stavros Niarchos (1909-1996) 12 -Case Study
Niarchos (his photo from Frangoulis) was born in 1909 in Sparti (Peloponnesus). He was 9 years younger than Onassis 13 . He was first employed in the flour mill company owned by his mother's brothers, the Kumantaros (in 1930; aged 21). He was also a law student at the University of Athens. He suggested to his uncles that it would be more profitable to buy vessels to transport company's flour and grain, at that time from Russia and Argentina, instead of using other people's vessels. He then took over the sea transport department of the company.

Niarchos as a Shipowner-1940 (Aged 31)
In mid-September 1939, Niarchos terminated his employment at the flour mill, and went to London. In 1940, he bought his first ship, called "Maleas", which was an old small dry cargo ship. He bought it with a loan. This was typical of Greeks at that time, who bought small, old and cheap vessels. Niarchos' vessel "Maleas" sunk during the Second World War.
Niarchos was lucky, however, in his bad luck, as he received war compensa-  Certain publications mention Onassis as born in 1900. When he was in Argentina, he increased his age to obtain a work permit, while he reduced it to avoid Turkish exile (Goulielmos, 2021a(Goulielmos, , 2021b. 14 From other sources (Kapsis, 2005), Niarchos had 2 vessels for which he received $1m for a war compensation. 15 Two of them were named after: Captain J Mataragas and Captain J Papazoglou; these ships were lost during the Second World War.
The tankers were of 12,000 dwt each, or 16,000 dwt, depending on cargo stowage factor. Greece received from the USA (lend-lease) seven tankers in all, of which Niarchos bought six. Niarchos paid $2 m for each. He also bought one Liberty ship for himself and one jointly with the Kumantaros.

The Vertical Integration Principle (1957): Niarchos' Philosophy (Aged 48)
Niarchos was the only shipowner who realized first the importance of vertical integration, an idea he first applied to the flour mill company where he worked for. This idea was applied by Japan, which had no iron ore or oil. This idea led Niarchos to establish: a steel-mill, producing the raw material (steel) for his ships, a shipyard: for building them, and a fleet: that he owned and managed.  m, for the fear that the shipyard was going to be nationalized.
Niarchos was a citizen of USA, UK and Monte Carlo initially, and after 1967 also of Greece. Niarchos initially believed in the Greek flag, as other Greek shipowners did. The Greek flag was "protected" from ITF (sea labor union) and it could visit Russian ports, at that time, without obstacles. Niarchos' first company was established in New York in the 1950s and then transferred to London, due to problems created by the USA Government.

Niarchos' Belief in Tankers and in the Demand for Oil
Niarchos saw that the demand for oil was increasing globally, and that the oil majors were not as yet prepared to invest in their own tankers. The USA consumed 6000 barrels per day in 1950 and 14,000 in 1970, while Western Europe went from 1800 barrels per day to over 12,000. Japan, too, later, reached 4000 barrels per day.
Moreover, the global shipbuilding industry only delivered tankers of a 45 m dwt total, or 55% of the ships built between 1946and 1964. Niarchos, in 1955 (aged 46), followed an extensive shipbuilding program of large tankers of an increasing size, occupying first place in front of Ludwing and Onassis. Niarchos realized the benefits of economies of scale (over cost, and for profit) and the need of the USA and European shipyards for orders, and later of Japan.
Through his shipbuilding programs, Niarchos helped European shipyards to come back after their total destruction in the Second World War. He was clever enough to use time-charters with oil majors as a guarantee at the time of placing an order 18 , and in securing finance, as well.
At this time the location of refineries changed from places of extraction to places of consumption, where things were stable, and with no risk of nationalization, as happened in the Middle East. This favored tankers and product carriers. The USA economy emerged from the Second World War almost intact, with higher savings, which were invested in houses, cars and household appliances.
Japan imported from the USA whatever was needed for its development. Coal was dethroned by oil.
However, the T2 tankers were not suitable for the distances created after the 18 This is where Colocotronis Greek shipowner failed (Couper, A.D., 1999).

The Lack of Own Funds Was a Serious Obstacle to Fast Growth
The cyclical nature of the shipping industry, shown before the Second World War, forced shipowners to buy ships using their own cash. This method did not allow companies to grow at the fast pace they wanted, as it has been shown in one of the case studies of Onassis (Goulielmos, 2021a(Goulielmos, , 2021b. If the owner could put down only 20% of the cash and fund 80% with a loan, then a fleet -this waycould grow five times faster. The loan could be secured by a simple mortgage, the preferred method, on the vessel to be built. But still there was a credit risk. This could be passed on to the oil majors if the ship had a long-term time-charter, which served as a guarantee for bankers. Oil majors were reliable in paying hires. The banks then provided the majority of the money (80%) to shipowners for the construction of vessels and the oil majors were paying the hires for 15 -20 years ahead. Private tanker owners were more competitive than oil majors, and the oil majors transferred to hiring charters, where they had previously had their own transportation departments and fleets to satisfy their most valuable customers promptly (Lun et al., 2013: pp. 27-62).

Niarchos during Dictatorship in Greece, 1967-1974
In 1967, a dictatorship ruled Greece. In 1972, Niarchos established a factory to build diesel engines together with Fiat. The Government eventually subsidized the construction of ships by Greeks in Greece. The "Skaramagas shipyard" built ships of 37,000 GRT (bulk carriers). Niarchos ordered 12 dry cargoes ships to be delivered by the end of 1972. Instead of attracting the orders of other Greek shipowners to his shipyard, Niarchos ordered his own ships there … In 1973, the market improved. Niarchos secured the lowest cost possible and he had priority in orders, so, he ordered six ships of 120,000 GRT each. The VLCCs in mid-1973 earned millions of dollars. These ships earned $1 per barrel as a hire (roughly $2 m per year, in 1995; at W89 index units). The use of VLCCs became universal by 1969. Some of Niarchos' tankers were stuck with low time-charter hires before 1973.

Niarchos and the VLCCs/ULCCs
The extraordinary rise in the demand for oil led shipowners, and Niarchos, to large tankers. The Suez Canal and many ports could not allow calls from ULCCs and VLCCs at first, with the exception of the ports of Japan. VLCCs emerged in 1966-1968, but Greeks were not in the first seven shipowners, who ordered about 3.6 m dwt of them. Greeks were usually followers, and used to buy second hand vessels. They wanted other shipowners to burn their fingers first, but they also wanted to be competitive.

Niarchos and the Recession after 1973
In September 1973, freight rates were at their maximum. But in October 1973, a recession had struck and the oil trade fell, as the price of oil increased many times. Energy saving was then adopted as a common policy. A number of tankers were laid-up. New buildings stopped. Pre-existing time-charters saved Niarchos. He concentrated on cost reductions and staff cuts. This was the practice among Greek shipowners in a crisis. Greeks knew that their industry is cost-based and not freight-based.
In 1973, Niarchos took delivery of his first product carrier of 36,000 GRT. Then another followed, and three in 1974, and one dry cargo of 37,000, followed too by another six in the next 30 months. Niarchos then started scrapping his older ships. Between 1974 and1982, 99.6 m dwt of tankers were scrapped, globally, with a maximum in 1982 (roughly 25 m dwt 21 ). 20 He was in favor of technology. In 1971 he had installed a satellite system of communications in all large tankers and the ULCCs he owned. This system indicated also the right course leading to savings in fuel. He also installed the first system of ITT, the "Aerospace 5001". 21 Data given by Figure 12 for 1982

Niarchos in 1973-1975
The situation from 1973 to 1975 is presented in Table 7.

Niarchos during the 1981-1987 Depression (Aged 72)
At the end of 1981, Niarchos realized that shipping was no longer an industry where one could invest with a continuous success. Niarchos sold all his VLCCs, when the market improved in 1990, receiving $105 m, with a profit of about 50%. In fact, in March 1990, second hand prices indeed peaked for tankers ( Figure 13). The impact of age on vessel's value was great, especially after early 1990. A vessel built in 1970 (22 years of age), after March 1990, lost most of her value, while a vessel built in 1980 (12 years of age) retained her price. The VLCC "Exxon Valdez" accident in Alaska led the oil majors to use tankers of other owners for fear of a major marine accident. Niarchos bought a vessel of 300,000 dwt, ordered by "Amoco", and took delivery of her in 1993, with perfect automatic electronic equipment, at a low price. She was called: "Ocean Guardian".

Concluding Remarks
Niarchos required to be briefed about any decisions that had been taken by others in his company. He was a hard worker. He used to read fast, and study everything. He used to dictate his answers. He had a sense of time. He used to reward his aides with money or words. He did not rely on chance, and he wanted to be sure about everything. He was in favor of good public relations, as with the top officials of Fiat or Shell, and he liked to impress his high standing friends with his yacht "Kreoli" and his private island "Spetsopoula". Niarchos believed in training of his staff, and he complained that he could not find capable aides to help him. He used to select staff by examining carefully his/her previous working experience. For example, he appointed the ex-general director of "Shell" to deal with tankers. He used experts to advise him over investments, like the English economist Kitchner, as well as others.
He preferred action to inaction. He acted here and now, today, rather than leaving it for tomorrow, and he looked for effectiveness. He stood by his opinion and it was difficult to convince him to change his mind. He was not a socialite, but kept his distance from others. He was conservative, usually in a permanent bad mood, and laconic by nature.
He envied Onassis, whose steps watched and followed carefully (in preferences, decisions, and selections). Niarchos was tough with those that had to pay to him freights and hires and were in delay. He had a sharp mind, was a perfectionist, with a good memory, and a fast decision-maker. His management was personal. He liked to spend money, but with the utmost care. He was demanding about increasing results, and he had sudden outbursts that created tension for everybody.
He liked accurate replies from the start and disliked errors and corrections afterwards. He wanted to be first and invincible. He was tough if someone cheated him. He finally acquired whatever he wanted. He had a natural ability to choose the right investment, and to determine its upper price, for which was also right.
Niarchos lived 21 years  longer than Onassis and faced the tanker shipping recessions in 1974,1975,1979. So, Niarchos had harder times as a shipowner. The freight rates for tankers were cyclical, but peaked 4 times in the period from 1947 to 1957. The 1958-1967 decade was bad for freight rates. In the period between 1968 and 1987, freight rates peaked again four times.
Niarchos was successful as a shipowner, devoting 20% of his $400 m estate to a foundation upon his death. Although shipping markets finally disappointed him, unlike Onassis who was disappointed and completely destroyed by the death of his son. Overall, Niarchos based his business on the right horse, which was oil, until the end of 1973. He also based it on economies of scale. His unlucky star faced a number of oil recessions and depressions in 1974, and thereafter, because he failed to balance his fleet over the various shipping sectors, tankers, product carriers and dry-cargoes, so that he could spread his risk, among types, sizes and ages. History teaches that a shipping crisis does not hit all ships, of all sizes and ages, equally.
His great competitive advantage was to have his own shipyard for his own orders and at his disposal. So, he had ships when he needed them, at priority and at a low price, built from cheap steel that he produced. He tried to cut costs, crew and staff to save about 20% of his outgoings when facing shipping depressions, but, like all shipowners, he could not foresee them or be ahead of them.
Coming from a tough area (Mani), he was a tough personality, especially with his wives.

Conflicts of Interest
The author declares no conflicts of interest regarding the publication of this paper.