The Salvage Economics of a Burning Vehicle Carrier

When a PCTC is declared a constructive total loss, the hull number gets quoted in the press and the rest of the bill goes quiet. The rest of the bill is where the real money lives — and it is the part that has been moving fastest over the last three years.

The four cost layers

• Hull — the insured value of the vessel. Bounded and well understood.
• Cargo — every vehicle on board, plus the GA contribution from cargo interests.
• Salvage — towage, fire-fighting tugs, stabilization, and tow-to-port fees.
• Wreck removal and environmental — uncapped, and increasingly the headline item.

Why detection lead time pays for itself

Salvors price intervention against escalation. A fire caught in the first 20 minutes is a tug job. A fire caught after the deck is fully involved is a multi-vessel, multi-week stabilization. The economic difference between those two outcomes is large enough to fund the entire detection layer for a fleet several times over.

Sources

• Allianz Global Corporate & Specialty — "Safety and Shipping Review" 2023 and 2024 (Felicity Ace total-loss commentary).
• International Salvage Union — Annual Industry Reviews (salvage and wreck-removal cost trends).
• TradeWinds — MOL Felicity Ace loss reporting and salvage cost analysis (2022–2024).
• Lloyd's List — post-casualty PCTC capacity reporting (2022–2024).
• [VERIFY: "$400M+" Felicity Ace total estimate — range reported across multiple secondary sources; exact figure not formally published.]
• [VERIFY: "~30% salvage and wreck-removal share" and "8–14 mo route-capacity gap" — adjuster-industry rules of thumb; no canonical primary citation.]