Maersk Cuts Asia-Europe Capacity 9 Percent

Maersk Line said it is cutting vessel capacity on the Asia-Europe route by 9 percent in a bid to boost flagging freight rates and restore profitability but vowed to defend its market share on the world’s biggest container trade lane.

The Danish carrier is also mulling further ways to cut capacity on the depressed lane by laying-up ships, slow steaming and redelivering time chartered vessels “where commercially appropriate." Maersk also confirmed it will not exercise an option to buy an additional 10 18,000 20-foot equivalent units vessels on top of the 20 ships it ordered in 2011.

The 9 percent cut, to be achieved through a vessel-sharing agreement with rival carrier CMA CGM on the Asia-Mediterranean route in early April, comes on the eve of planned rate hikes by most lines ranging $750 to $800 per 20-foot container on the westbound leg from Asia on March 1.

“With this adjustment we are able to reduce our Asia-Europe capacity and improve vessel utilization without giving up any market share we have gained over the past two years,” said Soren Skou, CEO of the world’s largest ocean carrier.

“We will defend our market share position at any cost, while focusing on growing with the market and restoring profitability.”

Maersk referred to a report by Alphaliner, a container analyst that traffic growth on the Asia-Europe trade will slow to 1.5 percent in 2012 from an estimated 2.8 percent in 2011, due to a weakening economic outlook in Europe. The world’s container fleet, by contrast, is set to grow by 8.3 percent in 2012.

“The Asia-Europe trade remains the world’s busiest trade lane, however the supply of vessels currently operating on this trade simply outweighs the demand,” said Vincent Clerc, chief product and yield officer for Maersk Line.

Maersk said the vessel-sharing agreement with France’s CMA CGM will allow it to remove capacity “while still maintaining full and competitive coverage for its customers.”