China Cosco Holdings is to order ten 19,000 TEU mega-ships at a cost of around US$1.4 billion in a bid to dominate the world’s busiest trade routes, according to The Wall Street Journal.
It was reported recently by PTI that Hong Kong based shipping line OOCL had placed a world record breaking order for six 21,000 TEU ships.
This was reflected in a recent infographic, showing the mega-ships members club and how many ships each of the world’s biggest shipping lines currently owns.
There has been much concern in the shipping over the ‘oversupply’ of mega-ships in the shipping industry, with Drewry Shipping Consultants predicting that ship orders will remain a relentless issue as container lines order more ships without any clear sign of an equilibrium between supply and demand.
There has even been talks that oversupply could remain a permanent problem unless financial performance improves, as well as the demand for more carriers.
OOCL’s chairman said that the focus of many shipping lines is increasing profitability and market and that this can only lead to excess capacity and an attitude that revolves around reducing costs to circumvent this excess.
The weak global economy has played its part in causing slow economic growth for the shipping industry, with economic development being hindered by this oversupply.
(Source: China Cosco)