As a result of the slump in container freight rates and lower demand for trade, Maersk and MSC have cut one of their 2M Asia-Europe services, according to World Maritime News.
This news follows a recent announcement made by the carriers to add MOL to one of its Asia and the East Coast of South America routes in a bid to bolster its service reliability.
The decision is also reflective of the volatility that has been occurring around freight rates, with previous claims made by Drewry that instability of rates had reached 40%.
Total trade growth is also said to have dipped by around 3.5% in H1, 2015.
Trade analyst Alphaliner believe that the cutting of the service comes too late, stating: “Alphaliner already highlighted the need for each of the four alliances to remove one Far East to North Europe string in June, in order to balance trade capacity with the lower demand.
“The 2M carriers however, remained steadfast in not withdrawing any capacity throughout the months of July and August. The shipping lines’ failure to remove surplus capacity has effectively doomed the last two General Rate Increases (GRIs), announced on 1 July and 1 August, respectively.”
The Journal of Commerce reported MSC as saying: “Since the new Asia-Europe network was launched in January 2015, continual performance analysis has allowed us to optimise the allocation of capacity among our services to meet customer demand.”
Freight rates are causing liners to see dips in profits, as was recently the case with Maersk Line, whose profits dipped by around US$500 million.
This has occurred in conjunction with a drop in share prices, which Drewry cite as being attributable to the gloomy outlook, exacerbated by overcapacity and lower demand.