Evergreen Marine Corp (長榮海運) is withdrawing 31 aging ships from its fleet to cope with slumping demand, a company official said yesterday.
Asia’s largest container shipper also said it would raise rates on Asia-US routes next month, after an alliance of major container shipping lines reached a deal on Tuesday, an Evergreen’s public relations official said by telephone.
Evergreen is scheduled to dismantle one-sixth of its 180 ships through 2013, Eric Lin (林司忠) said, confirming reports carried by two local business dailies yesterday.
Under the plan, the company is to return some chartered ships to their owners when their leases expire and dismantle other ships more than 26 years old and sell them as scrap metal, Lin said.
Jack Yen (顏火燿), president of Evergreen Marine, said in a stock exchange filing later yesterday that the 31 container ships destined for dismantlement are 20 G-type ships and 11 GX-type ships.
The G-type ships, with a capacity of 2,728 TEUs (twenty-foot equivalent units), and GX-type ships, with a capacity of 3,428 TEUs, were built between 1983 and 1988, the Chinese-language Economic Daily News reported.
The move came as Evergreen chairman Chang Jung-fa (張榮發) said in a recent interview with Japan’s Kaiji Press that this year would be the most difficult year for the shipping industry, which has been struggling with overcapacity and falling volume, the Commercial Times reported.
However, the company, like other major shipping lines in the world, was also under pressure from declining rates, especially as freight prices on some US and European routes are already at below cost price.
The Transpacific Stabilization Agreement (TSA), of which Evergreen is a member, announced on Tuesday that the shipping alliance plans to raise US$500 for each 40-foot box on Asia-US routes beginning on Aug. 10. The shippers will also raise fuel levies and may add peak-season surcharges, the 14-member group said.
Lin said Evergreen would raise the rates next month, even though the plan is a “voluntary guideline” for TSA members. He did not elaborate on the increased fuel levies and surcharges.
On July 1, Evergreen said it and Cosco Container Industries Ltd (中遠集裝箱運輸公司) had agreed to combine their services on Far East-South America routes and Far East-Africa Express routes into a new service, to cope with soaring bunker prices in light of deteriorating market conditions.
The new service, which started on Monday, operates with a total of 11 3,500 TEU vessels, with seven vessels from Evergreen and four from Cosco Container, Evergreen said on its Web site.
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