German Shipping Firm Hapag Lloyd Foresees Challenging Years Ahead
Hapag Lloyd Anticipates Difficulties in the Shipping Industry
The head of German shipping company Hapag Lloyd, Rolf Habben Jansen, has expressed concerns about the challenges that lie ahead for the shipping industry. He believes that the next three years will be particularly difficult due to the slower growth in demand for shipping services compared to the available shipping capacity. This poses a significant obstacle for the industry to overcome.
A Less Severe Downturn Expected
Despite the anticipated difficulties, Jansen remains optimistic that the downturn in the sector will not be as severe as the one experienced after the global financial crisis in 2008. During that time, the launch of new capacity accounted for 55% of the existing fleet, whereas now it only amounts to 27%. This difference suggests that the impact on the industry will be more manageable in the current scenario.
Freight Rates Experience Decline
Jansen highlights that freight rates have dropped by approximately 60% year-on-year, reflecting the challenging market conditions. However, he believes that the cyclical nature of the container shipping business will prevent the situation from deteriorating to the extent seen in 2008 and 2009.
In conclusion, Hapag Lloyd’s CEO acknowledges the difficulties ahead in the shipping industry. Nonetheless, he remains cautiously optimistic that the sector will weather the storm better than it did during the previous global financial crisis. Despite the decline in freight rates, Jansen believes that the industry’s cyclical nature will play a role in mitigating the impact.