The world’s largest container line, Maersk, is cutting its vessel capacity on the Asia-Europe route by nine per cent saying that ocean-capacity on the route had pushed freight rates to unsustainably low levels.
Maersk Line chief Søren Skou said: “With this adjustment we are able to reduce our Asia – Europe capacity and improve vessel utilisation without giving up any market share we have gained over the past two years. We will defend our market share position at any cost, while focusing on growing with the market and restoring profitability.”
The nine per cent capacity reduction will be facilitated by a vessel sharing agreement with the French container shipping line, CMA-CGM.
The deal will also enable Maersk to cut the cost of serving West Mediterranean markets, enabling it to deploy its own vessels to areas where they are most needed as well as to pursue further slow-steaming.
A January report from shipping analyst, Alphaliner, predicted Europe – Far East container traffic growth would slow to 1.5 per cent in 2012 from an estimated 2.8 per cent in 2011, due to a weakening economic outlook in Europe. The industry container vessel fleet, by contrast, is set to grow by 8.3 per cent in 2012.
“The Asia – Europe trade remains the world’s busiest trade lane, however the supply of vessels currently operating on this trade simply outweighs the demand. We are therefore rationalising our service by taking out vessel capacity and thereby reducing costs,” says Vincent Clerc, chief product and yield officer for Maersk Line.