Ships for the long (and short) haul

A range of container vessels, most of them on the large end of the scale, will begin arriving this year to replace older, less efficient ones and help Maersk Line grow in line with its largest competitors.

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Madrid Mærsk at Tianjin Port.

Four years after the arrival of the first Triple-E vessel, Mærsk Mc-Kinney Møller, a 2nd Generation Triple E is joining the fleet. The arrival of Madrid Maersk at the Chinese port of Tianjin on April 27 marked the first of 27 ships that will join the fleet this year and next, including eleven 2nd Generation Triple-Es.

“Our strategy is to grow in line with our main competitors and we do that through a combination of buying new and used ships, and chartering vessels” says Søren Toft, Chief Operating Officer, Maersk Line. “These new vessels help modernize our fleet, significantly improve our operational efficiency and will help us achieve our growth ambitions, regardless of short-term economic cycles.”

Discipline on the road to growth

Reflecting the need for the new capacity is Maersk Line’s head haul utilisation rate, which hit an average of 93% in 2016, leaving little room for growth without additional capacity. And while overcapacity remains a problem for the container shipping industry, the 27 new vessels coming into Maersk Line’s fleet are equal to just 11% of Maersk Line’s current fleet, compared to an industry average of 15%.

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“If you look at our current order book and also the capacity we are able to return to charter owners, which is roughly 20%, we are in a pretty good position,” says Toft.

“We are expecting to grow this year, and expecting global growth of about 3%, but if those things don’t happen we also have a powerful ability to adjust our network to changing conditions in a way that many other shipping lines do not have.”

It is what Maersk Line calls active capacity management and it includes other tools like recycling old ships and idling unneeded ones among others, to help it more accurately match supply with demand in its network. The decision to delay the second order of the 15,226 TEU H-Class ships by six months is also an example.

Efficiency and flexibility in focus

The new vessels continue the tradition within Maersk of improving efficiency. All of the new vessel types are designed and optimised for how the vessels are expected to operate, including which speeds will be sailed and what cargo will be loaded; however, the primary efficiency improvements in all of the new vessels are due to increases in container carrying capacity, which lowers energy usage and costs per container carried.

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For example, the 2nd generation Triple-E’s nominal capacity is 20,658 20-ft containers (TEU), nearly 2,000 more than the prior generation. However, it manages this within a vessel body with nearly identical length, width and height. As a result, the 2nd generation is ~7% more efficient per container carried than the Triple-E.

Not to be outdone, the new H-Class vessels have a nominal capacity of 15,226 TEU and are able to carry nearly the same number of containers as the original design of the Emma class, but do so in a body that is 46 metres shorter. It is an important characteristic of a ship that was designed for operational versatility in order to take advantage of shifting trade patterns. The greater capacity allows it to efficiently serve on the East-West trades, while its smaller size means it is also capable of calling what are typically smaller ports on the North-South trades, if needed.

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Finally, the 7 ice-class Baltic feeder vessels were designed both to meet the specific emission regulations of the region and the rising volume growth in this trade in recent years. The 3,596 TEU nominal capacity of the vessels more than doubles the current size (1,400 -1,700 TEU). And since the vessels will use marine diesel fuel, they will be fully compliant with the Emission Control Area (ECA) rules established by the International Maritime Organisation (IMO).

“Global growth may pick up this year or not, but these are factors we can’t control,” says Toft. “What we can control is our position as the market leader and cost leader and we strengthen both of those with these new vessels, while continuing to actively manage and optimise our network, improve our utilisation and drive down our costs.”

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