China Shipping Container Lines has placed orders for eight 13,500 twenty-foot-equivalent container ships at Shanghai Jiangnan Changxing Shipbuilding, continuing the aggressive fleet expansion began last year.
As agreed, Jiangnan Changxing will design and build eight 135,000-TEU container ships for the subsidiary and CSTC will take charge of money collection. Contractual value is USD 934 million, or USD 117 million per unit.
The newbuilds will be deployed in the Asia
-U.S. East Coast trade
routes and are scheduled for delivery from April 2018 to December 2018.
"The group positively responds to the development trend for large-scale container vessels in the shipping market, adheres to low-carbon environmental protection initiatives, and is committed to adjusting and optimising the structure of its fleet," CSCL said.
China Shipping Container Lines said the subsidiary would pay the consideration with self-owned capital and bank loans. The deal would raise its debt asset ratio, but help further optimize fleet structure, transport capacity and raise comprehensive strength.
CSCL said the subsidy for the retirement and replacement of ships will have a positive effect on its 2015 annual results.
CSCL was aggressive in bringing in new capacity during 2014. Its fleet increased by 19 percent year-over-year as eight 10,000-TEU ships and two 19,100-TEU vessels were delivered. On Dec. 31, 2014 CSCL had 158 container ships with a total capacity of 726,613 TEUs, and had carried 8 million TEUs.