Juggling Follows New Ship Capacity
With China’s COSCO confirming its $1.5-billion order of 11 new 19,000 TEU ships for delivery in 2018, the “arms race” for Ultra Large Container Vessels (ULCV) of over 18,000 TEU continues but carriers are having to be more creative when deciding where to deploy smaller deliveries, cautions maritime analyst, Drewry, in this week’s Container Insight report.
The average price for each ship comes in at $137.4 million, which represents a significant discount of around $10-20 million paid by other lines for similar-sized leviathans, a measure of the Chinese shipbuilding industry’s need for new orders.
To give a sense of the newbuild price deflation, Maersk’s 18,000 TEU “Triple-Es” ordered in February 2011 cost $190 million apiece.
Cosco’s orders means that there are now nine carriers who either have ships of this size currently in their fleet or on order.
More are expected to follow as CSCL is reportedly on the verge of ordering 11 more ULCVs, while Japanese shipyard Imabari has also reportedly received an order for four 20,000 TEU units with an as yet unnamed owner.
There is no going back from this point as the industry has made it abundantly clear that they see these ULCVs as the future. But recent developments have exposed their inflexibility somewhat.
The alarming drop in Asia to Europe traffic and a parallel crash in rates caused two of the big carriers groups to take the unprecedented decision to suspend services in the supposed peak season, while the two other alliances have been tinkering with missed sailings in order to try and support higher rate requests.
