General Maritime Transportation was found as a private entity in 1997. The company kept growing with its fleet size and focused on increased sale. In 2001 GMT reached 30 ships with acquired of 9 oil/bulk/ore ships. The firm also expanded its fleet substantially with the acquisition of 19 tankers in 2003. However, the company started to sell out its ships and reduced fleets in 2005 and so on. According to the case study, General Maritime Transportation (GMT) had reduced its fleet form 40 ships to 19 in 2006-2008 by sold 26 old model vessels, single-hull tanker. As a result, the average age of the firm’s fleet, which is calculated by taking an average of the age of every current vessel, fell down from fiscal period (9.5 year) to 8.9 in 2007. The lower number might relate the lower costs of old ships maintenance and operation such as fuel inefficient or slower travelling time. However, newer ships with higher efficiency are needed to be replaced sold out vessels in order to support demand and company’s growth. GMT, although had ability to reinvest newer ships with higher efficiency, it refuse to enhance the fleet capacity when there was not an available of a good price; while the policy was focusing on bought back its own share and paid dividend to investors. This strategic decision was significantly affected the financial performance after 2006 when the revenue and closing stock price fell down dramatically.
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