Shipping: Hapag-Lloyd boss predicts “container overflow”.

Hamburg shipment

Hapag-Lloyd boss predicts “container overflow”.

CEO Rolf Habben Jansen (left) and supervisory board chairman Michael Behrendt of Hapag-Lloyd CEO Rolf Habben Jansen (left) and supervisory board chairman Michael Behrendt of Hapag-Lloyd

CEO Rolf Habben Jansen (left) and supervisory board chairman Michael Behrendt of Hapag-Lloyd

What: Bertold Fabricius

Hapag-Lloyd, the world’s fifth largest liner shipping company, expects the market to relax from the second half of the year. After major port traffic jams have been eliminated, the industry may be facing an old problem again.

V.For many years, major liner shipping companies have been competing against each other, especially with new ship orders, and some of them have struggled to survive. Only in the last decade has container transport managed to stabilize its business, with mergers, acquisitions and the formation of new alliances.

During the all-time pandemic, the sales and profits of major liner shipping companies increased like never before: neither the industry nor its customers expected that so many consumer goods in particular would be ordered. worldwide. Because millions of people today have invested so much money that they could no longer spend on travel and gastronomy, for example in furniture. The shipment lacked freighters and containers for this, and many ports during the pandemic lacked the ability to channel all of this. The consequences have been extremely high freight rates and freight prices for containers.

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Germany’s leading liner shipping company Hapag-Lloyd made a net profit of € 9.1 billion last year, which is arguably the highest annual profit ever recorded by a Hamburg-based company. But the days of boom and high freight rates are ending, according to Rolf Habben Jansen, CEO of the shipping company. “If we don’t have big surprises, the market situation will relax significantly over the course of the year,” he said Thursday evening at the Hapag-Lloyd headquarters in Ballindamm at an event organized by the Hamburg Overseas Club. transport will settle at a slightly higher level than in 2018. The fact that they do not return to the level at that time is mainly due to the cost of fuel and ports, which have increased since then ”.

The industry could therefore be threatened by the opposite of what it has experienced in the past two years, namely a relapse into overcapacity. Hapag-Lloyd alone has increased its container fleet by 625,000 units (TEU) to approximately three million TEUs since the start of the pandemic. So many boxes are needed because many of them are locked in seaports or with customers.

For example, the extensive closure of the world’s largest container port, Shanghai, due to the pandemic, is putting a strain on logistics around the world. It usually takes 50 days for a container to be returned by a customer and available again for the shipping company, said Habben Jansen. Up to 66 days have passed in the pandemic and currently an average of 63 days.

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In “normal” times, liner shipping companies need significantly fewer containers than today. “When the traffic jams in and in front of the ports clear up, we will be swimming in containers,” said Habben Jansen. “There will then be millions of containers too many around the world.” There is also the risk of new overcapacities for ships. The shipyard’s order book for container ships currently comprises around 25% of the world fleet. This is considerably less than 56 percent in 2007: the overbooking and overcapacities of the time had brought numerous shipyards and shipping companies into the abyss in the subsequent crisis of the global financial markets. But even 25 percent today is too much for the market, Habben Jansen said, despite the foreseeable need to scrap older ships, which are expected to be withdrawn from the market due to stricter environmental and climate protection regulations. .

For 2023, for example, the industry expects an 8% growth in the transport capacity of the global container fleet, but only a 4% growth in the volume of international container transport. “2023 and 2024 will not be the easiest years for the industry,” said Habben Jansen. Hapag-Lloyd has currently ordered twelve vessels with a capacity of 23,500 TEU each and ten with a capacity of 13,000 TEU each out of a total of approximately 250 freighters in operation or already under construction. This is necessary in order to have the optimal size of the ship in the respective trades.

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At the overseas club event, Michael Behrendt, president of the Overseas Club, who also chairs Hapag-Lloyd’s supervisory board, recalled how difficult times have been for Hapag-Lloyd in the wake of the global financial market crisis after 2008. He was managing director of the shipping company until 2014 and was involved in persuading a Hamburg consortium of investors led by the city and entrepreneur Klaus-Michael Kühne to acquire a majority stake in the shipping company.

Behrendt especially praised Michael Frenzel, the former head of the TUI tourism group in Hanover, who held a majority in Hapag-Lloyd at the time. Frenzel did not respond to a takeover bid by Singapore-based shipping company NOL, but instead sold the shares one after another to the Hamburg consortium. He helped keep the largest German shipping company in Hamburg independent.

Through mergers with CSAV in Chile and UASC in the UAE, Hapag-Lloyd has secured fifth place among the leading liner shipping companies over the past decade and now pays generous dividends to the city of Hamburg, which still holds 13 , 9% of the shares today. “For what he contributed to this,” Behrendt said, “a monument to Michael Frenzel should be erected here in this house.”

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