The number of vessels that are being scrapped world wide is at its highest since November 2009. On December 19th 219 ships with a capacity to carry 546,000 boxes were idled. Alphaliner, the Parisian maritime data provider, reported that demolition of vessels will continue into 2012.
The majority of the scrapped vessels were panama-sized ships. This is a standard size of ship that is able to travel through the Panama Canal. Some ships were 19 years old or older.
Some of the worldwide transportation companies that reported economic loss this year were Neptune Orient Lines Ltd. and China Cosco Holdings Co. The poor earnings lead companies such as these to retire vessels in order to increase demand by lowering supply.
New Tactics in Trying Times
Another tactic that international shipping container companies are trying is to ally themselves into corporations. Last week eight major storage container companies strengthened their connection. The latest movement involving collaboration is Taiwanese Evergreen Marine strengthening communication with the Green Alliance. Evergreen Marine is the fourth largest shipping company in the world. The company is not fully joining the Green alliance, but it is strengthening communication with the members of the group, which consist of COSCO, K Line, Hanjin Shipping, and Yang Ming Line. These companies are all major players in international trade.
Maersk Finishes Building New Line
The major competitor to the Green Alliance is Maersk Container Lines, which just finished building its newest series, the Triple E series. Maersk is also currently involved in a scandal involving its rental of storage containers to the Pentagon for the war in Afghanistan. The $720 million in late fees charged to the Pentagon was actually due in large part to inflated late fees and wrongfully done business. Maersk is now paying the United States government $18.4 million to cover its overcharges and $13.5 million in penalties.