Post by dockside on Dec 5, 2008 13:21:07 GMT -5
Maersk Lays Up Eight Box Ships
The JOURNAL of COMMERCE
December 4, 2008
By Bruce Barnard
Maersk Line, the world's biggest ocean container carrier, announced that it has laid up eight container ships for six months following cuts in services and the slide in liner freight rates.
The Copenhagen-based operator said it would idle more vessels unless current market conditions improve.
Maersk said the 6,500-TEU ships became surplus after recently-announced changes in its Asia-Europe, Asia-Central America and trans-Pacific service networks.
“In view of market conditions, we have reached the point where laying up the eight vessels makes better economical sense than redeploying them,” said Michel Deleuran, head of network and product at Maersk Line.
“Freight rates remain under severe pressure, and in several corridors the rates do not fully cover our variable costs,” Deleuran said. "Rate improvements are imperative for the industry to create a sustainable environment.”
The eight vessels will be laid up from December to May/June, 2009, mainly in Asia, where the carrier has implemented the deepest service cuts. On Nov. 10 it suspended one of its Asia-Europe services between Yokohama and Le Havre, trimming capacity by 10 percent, or 7,600 TEUs a week.
Maersk said it will continue to adjust capacity in light of market developments by streamlining schedules, consolidating services, vessel sharing agreements, enhancing port productivity, reducing ships’ sailing speeds “and -- unless market conditions improve -- additional laying-up of vessels.”
“We make these changes to reduce capacity and save costs, while we at the same time seek to maintain our service level and coverage,” Deleuran said. The recently announced Asia-Europe and trans-Pacific service changes include more direct services, he said.
Maersk Line Chief Executive Eivind Kolding earlier said that between 10 and 15 medium-sized carriers could be taken out of service due to surplus capacity.
Asia-Europe cargo volume shrunk by around 3 percent during the third quarter and base freight rates on westbound routes have fallen to $250-300 per 20-foot container from $1,700 in the summer of 2007.
The JOURNAL of COMMERCE
December 4, 2008
By Bruce Barnard
Maersk Line, the world's biggest ocean container carrier, announced that it has laid up eight container ships for six months following cuts in services and the slide in liner freight rates.
The Copenhagen-based operator said it would idle more vessels unless current market conditions improve.
Maersk said the 6,500-TEU ships became surplus after recently-announced changes in its Asia-Europe, Asia-Central America and trans-Pacific service networks.
“In view of market conditions, we have reached the point where laying up the eight vessels makes better economical sense than redeploying them,” said Michel Deleuran, head of network and product at Maersk Line.
“Freight rates remain under severe pressure, and in several corridors the rates do not fully cover our variable costs,” Deleuran said. "Rate improvements are imperative for the industry to create a sustainable environment.”
The eight vessels will be laid up from December to May/June, 2009, mainly in Asia, where the carrier has implemented the deepest service cuts. On Nov. 10 it suspended one of its Asia-Europe services between Yokohama and Le Havre, trimming capacity by 10 percent, or 7,600 TEUs a week.
Maersk said it will continue to adjust capacity in light of market developments by streamlining schedules, consolidating services, vessel sharing agreements, enhancing port productivity, reducing ships’ sailing speeds “and -- unless market conditions improve -- additional laying-up of vessels.”
“We make these changes to reduce capacity and save costs, while we at the same time seek to maintain our service level and coverage,” Deleuran said. The recently announced Asia-Europe and trans-Pacific service changes include more direct services, he said.
Maersk Line Chief Executive Eivind Kolding earlier said that between 10 and 15 medium-sized carriers could be taken out of service due to surplus capacity.
Asia-Europe cargo volume shrunk by around 3 percent during the third quarter and base freight rates on westbound routes have fallen to $250-300 per 20-foot container from $1,700 in the summer of 2007.