The world’s largest container shipping company, the Maersk Line, of Denmark, has postponed the delivery of its nine 14,000 teu ships currently under construction after reporting a loss of $376mn last year.
With delivery delays of between one month and one year, the line said the last vessel from the batch, being built by Hyundai Heavy Industries, of South Korea, will be delivered by the end of 2018, a year later than the previously scheduled delivery date of the end of 2017.
“Despite some positive developments seen in the second half of 2016, freight rates remain depressed and unsustainable. That is why we will continue to manage our capacity tightly,” said Pierre Danet, of the Maersk Line.
“The move was made on the back of a very challenging market situation.”
The decision was announced as part of the company’s financial report in which the Maersk Line said the $376mn loss was driven by a 19 per cent decline in freight rates year-on-year, compared with a profit of $1.3bn seen a year earlier.
The company’s revenue for 2016 stood at $20.7bn, 13 per cent lower than in 2015 when it was $23.7bn. By the end of 2016, Maersk Line’s volumes grew by 9.4 per cent to 10,415,000 FFE (40ft. equivalent), up from 9,522,000 FFE handled in 2015, as the line won a significant market share. All trades contributed with the largest increase in the East- West backhaul with 19 per cent.
“The loss is clearly unsatisfactory. On the positive side, we won market share, we continue to drive costs down and we increased our utilisation. We remain competitive,” Mr Danet said.
“We have a strategy that addresses the challenges in our industry. It will ensure that we continue to focus on customers, that we maintain our leadership position and that we again become profitable.”