Some of the world’s top container lines risk being squeezed out of the Asia-Europe trades unless they order more ultra-large vessels.
Both the Grand Alliance of Hapag-Lloyd, OOCL and NYK Line, and the New World Alliance comprising APL, MOL and Hyundai Merchant Marine, will need to add to their fleets of ships in excess of 13,000 teu if they are to remain competitive on one of the world’s most important trade lanes, SeaIntel Maritime Analysis chief executive Lars Jensen warned.
“They need a lot more 13,000-plus tonnage, or they are going to have to rethink how they can compete in the Asia-Europe market,” Mr Jensen said.
Analysis by Copenhagen-based SeaIntel shows that in around two years from now, Maersk Line, Mediterranean Shipping Co and the CKYH alliance of Cosco, K Line, Yang Ming and Hanjin Shipping will be running almost all of their Asia-Europe strings with ships larger than 13,000 teu.
In contrast, based on the current orderbook, the Grand Alliance, New World Alliance and other independents will still be operating vessels of mostly 8,000 teu-10,000 teu.
Mr Jensen said this presented such smaller carriers with a “troubled choice”. They could either order more larger vessels or continue to operate existing ships between Asia and Europe. “This would give them a serious unit cost disadvantage,” he said. In a rate war, that would be unsustainable.
Alphaliner has calculated that a 13,000 teu vessel deployed in the Asia-Europe trades would have a cost advantage of $150 per 20 ft unit compared with an 8,500 teu ship, and would be $250 per slot cheaper than a 6,500 teu vessel.
Mr Larsen said that even after their recent spate of ordering, the fleet profiles of the Grand Alliance and New World Alliance would be “nowhere near” those needed to compete with Maersk Line, MSC and CKYH.