According to the chairman of parent group A.P. Moller-Maersk, Maersk Line, global top container shipping company, will lose money this year as well regardless of recent freight rate increases, Reuters informs.
Speaking at the annual general meeting of shareholders, Michael Pram Rasmussen, chairman of the A.P. Moller-Maersk board, confirmed the predictions from the company’s annual report that Maersk Liner Business will probably have a negative result this year due to its capacity surplus. The plans to return Maersk Liner back on track will include employing of various strategic methods, the primary goal being cost-effectiveness and profitability.
“We are reducing the speed of our ships and increasing the number of port visits that we make,” Rasmussen said.
Certain improvement in Maersk Line’s market share has been achieved due to a recent skyrocketing of container freight rates from $500 TEU to $1,700 TEU in Asia-Europe routes.
As stated by Rasmussen this resulted in a rise to 19.4% from 17.8 % in 2010, along with a volume increase of 16 %, paving the way for the line to complete 2011 with a 15.5% global market share.
Furthermore, prompted by a desire to establish satisfactory freight rates Maersk Line sought two increases one of $750 per twenty-foot unit (TEU) and another of $400 per TEU, totalling in around $1,000 realized on March 1 and April 1.
When it comes to the forecasted annual business operation of the entire group Rasmussen highlighted the fact that the A.P. Moller-Maersk group predicts positive results, even though still under the bar set in 2011.
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World Maritime News Staff, April 13, 2012; Image: Maersk Line