A combined qualitative ship valuation estimation model

Abstract

The determination of the direction in which supply-demand balance will occur due to instability in periods of economic crisis, and the volatility of the market, necessitate the use of combined mathematical methods. Brokers experience difficulty in determining a ship's real value because of the lack of instant and unbiased data that can be accessed at anytime and anyplace in the world. Mostly, brokers use a marketing approach to determine a ship's value. However, a marketing approach does not give an accurate solution under all conditions. Ships, especially those ranging in age from 6 to 25, that is, more than 5 years old, need to be evaluated with a combined method which differs from marketing approaches. There is no systematic and standard mechanism to determine a ship's value worldwide. The aim of this study is to develop a reliable ship valuation mechanism using the "Combined Qualitative Ship Valuation Estimation Model" to validate the ship's actual price. Within this model, the ship's value can be calculated more accurately. This model will be useful in determining the adjusted ship value and to provide decision-making support for willing buyers and willing sellers.