Is the future autonomous shipping?

Autonomous ships hold immense potential to transform and enhance the efficiency of global supply chains by streamlining operations and reducing human error. Their ability to operate continuously and integrate with other automated systems offers a new level of precision and reliability in the movement of goods. Additionally, their ability to adjust routes dynamically based on real-time data, such as weather patterns or port congestion, can lead to smoother, more economical logistics, ultimately improving the overall flow of goods worldwide.

It sounds promising on paper, but where is the shipping industry really at when it comes to autonomous ships?

The term “autonomous ship” is very broad, encompassing vessels with one or several autonomous functions and fully autonomous vessels that are able to operate with no human intervention. While the development of autonomous vessels is progressing steadily, with stakeholders working towards the realization of fully autonomous ships, this advancement is still nascent. 

There are currently only a few autonomous vessels in operation. A notable example is a small container ship in Norway capable of conducting short coastal voyages autonomously with a few hundred containers on board…

Investment in autonomous ships interests institutions as well, with the EU recently issuing a grant from its EU Innovation Fund’s Net Zero Technologies initiative to Norwegian shipowner Reach Subsea, allowing the company to expand its project involving 24-metre offshore support vessels that will be operated from a control center onshore.

The regulation of autonomous ships is still developing. The International Maritime Organization (IMO) is currently working on a Marine Autonomous Surface Ship (MASS) Code that is due to be finalized and then adopted as a voluntary code in May 2025. This Code is expected to be adopted as mandatory by July 1, 2030, coming into force on January 1, 2032. For now, the regulatory landscape remains sparse, but the IMO’s efforts signal the start of a standardized approach. Autonomous ships will still need to be registered with a flag state, and each flag will have its own requirements. Classification societies will also play a significant role in setting standards for autonomous ships, just as they do for traditional vessels. National as well as international regulations could also come into play as countries adapt their policies to this emerging technology. Furthermore, incidents and casualties involving autonomous ships are likely to drive further regulation, especially when it comes to safety requirements.

Autonomous technology introduces new risks, and insurers will need to develop products to cover these risks. As with any new product, premiums are likely to be high in the early stages, as insurers will need to carefully assess the risks associated with autonomous systems, and see them play out in the real world, to be able to determine where claims are likely to arise. As a result, insurance providers are yet to provide any significant updates on their proposed approach towards autonomous ships.

Over time, as autonomous technology matures and becomes more reliable and widely-used, premiums are likely to stabilize, but for now, insurance remains a significant concern for potential operators of autonomous vessels. While we are at the early stages of the journey toward fully autonomous ships, progress is being made from small-scale autonomous container ships to research into AI-driven navigation, laying the foundation for advancement. However, many challenges remain, particularly in terms of regulation, insurance, and the expertise needed to manage these advanced systems. As the technology evolves, so too will the maritime industry’s approach to integrating autonomy into its operations. Whether autonomous ships will become the dominant form of maritime transport remains to be seen, but they are certainly on the horizon.

Susan Riitala is a partner at global law firm Reed Smith in the Asset Finance team of the Transportation Industry Group focusing on shipping transactions and working with clients across the spectrum of transactional shipping matters, including debt financings, private equity investment, sale and leasebacks, and joint ventures. Thor Maalouf is a partner in the firm’s Shipping and Transportation Group, advising on all aspects of commercial shipping and maritime law, in particular charterparties, bills of lading, shipbuilding contracts, luxury yacht charters, charters for project cargo, and contracts for shipping and freight services, including multi-modal transport and logistics.