In three years, Maersk Line could lose its title as the world's largest container shipping line to Mediterranean Shipping Company (MSC). Rather than increasing its global market share, Maersk Line says it is working to increase profitability by reducing costs.
"Last year we made the decision to go from an aggressive growing-market share strategy to a grow-with-the-market-and-maintain-our-market-share strategy … That allowed us to take our capacity, it allowed us to close down a significant number of unprofitable routes, and those ships that were freed-up we have invested back into the network for slow steaming; adding additional ships to slow down the network."- Maersk Line Chief Executive
On the other hand, MSC, which is also one of Maersk Line's partners in the upcoming P3 Alliance, has approximately 465,000 twenty-foot equivalent units (TEUs) of new capacity on its order book. Other container lines are also continuing to grow their capacity, including China Shipping Container Lines Co. Ltd. (CSCL), which ordered five 18,400 TEU ships from Hyundai Heavy Industries (HHI) earlier this year. These new ships are larger than Maersk Line's Triple-E ships and were reportedly less expensive.
Maersk's efforts to bring supply in balance with declining demand growth have not been emulated by the other carriers, which are still aiming to grow their market shares. The twin impact of the lack of new orders and the redelivery of chartered tonnage could see Maersk lose its market share lead by 2016, with MSC well positioned to take over the lead carrier position, with its order book of over 465,000 TEU.