The CEO of Hapag-Lloyd is optimistic about the prospects of the shipping market
After experiencing an unexpectedly strong performance in the first half of the year, the container shipping market may exceed previous market expectations for the whole year. Hapag-lloyd's CEO Rolf Habben Jansen said at the latest earnings briefing that although the growth rate slowed down in the second half of the year due to the increase in tariffs and market caution, the overall outlook remains positive.
In terms of capacity, the pace of new vessel deliveries has been slower than in previous years, and the predicted delivery volume for 2026 is significantly lower than that for 2023 and 2024. Meanwhile, a considerable proportion of the global fleet is over 25 years old. It is expected that a wave of scrapping will occur in the coming years, returning to the pre-pandemic norm where ships would be retired after about 25 years of age. This means that the net increase in global capacity will not be overly inflated during 2025 and the period from 2026 to 2027.
"Orders on hand remain at a relatively high level, but delivery periods have been extended, and more of them involve replacing old vessels." " Habben Jansen added.
Hapag-lloyd has been making frequent moves in the renewal of its fleet. In June this year, the company received the last 23,664 TEU ultra-large container ship "Wilhelmshaven Express" built by Hanwha Marine. The series consists of a total of 12 vessels. Looking ahead, Hapag-Lloyd holds a total of approximately 312,000 TEU of orders, which are expected to be delivered between 2027 and 2029, involving 24 new LNG-powered vessels ranging from 9,200 to 16,800 TEU. Meanwhile, the company also plans to carry out methanol power conversion on five 10,000 TEU vessels next year.
In terms of freight rates and demand, Hapag-Lloyd expects its full-year transportation volume to maintain a moderate growth, benefiting from a strong performance in the first half of the year. Although spot freight rates have declined after peaking in the middle of the year, the increase in US tariffs has not reached the level that the market was worried about. With the implementation of the new tariff policy this month, the market has gained a clearer reference, which is expected to have a practical impact on the trend of cargo volume.
In the long term, tariffs are not beneficial to global trade. However, what is more crucial than specific tax rates is the predictability of the market. Over the past few months, most customers have been on the sidelines. Now, we have a clearer understanding of what is happening. Habben Jansen said.
Financially, Hapag-Lloyd expects its full-year earnings before interest, taxes, depreciation and amortization (EBITDA) to be between 2.8 billion and 3.8 billion US dollars. Strong performance in the first half of the year, higher reliability of schedules and continuous investment in the modernization and sustainable development of the fleet have become the main supporting factors.
It is worth mentioning that the Gemini alliance jointly launched by Hapag-Lloyd and Maskey has performed outstandingly, with the reliability of shipping schedules consistently maintained at around 90%. This year, there have been almost no large-scale port skipping, and the reliability of shipping schedules has significantly improved compared to the past. Although the weekly capacity has not increased significantly, it can ensure continuous deployment instead of frequent cancellations of voyages due to delays. Habben Jansen said.
In terms of capacity, the pace of new vessel deliveries has been slower than in previous years, and the predicted delivery volume for 2026 is significantly lower than that for 2023 and 2024. Meanwhile, a considerable proportion of the global fleet is over 25 years old. It is expected that a wave of scrapping will occur in the coming years, returning to the pre-pandemic norm where ships would be retired after about 25 years of age. This means that the net increase in global capacity will not be overly inflated during 2025 and the period from 2026 to 2027.
"Orders on hand remain at a relatively high level, but delivery periods have been extended, and more of them involve replacing old vessels." " Habben Jansen added.
Hapag-lloyd has been making frequent moves in the renewal of its fleet. In June this year, the company received the last 23,664 TEU ultra-large container ship "Wilhelmshaven Express" built by Hanwha Marine. The series consists of a total of 12 vessels. Looking ahead, Hapag-Lloyd holds a total of approximately 312,000 TEU of orders, which are expected to be delivered between 2027 and 2029, involving 24 new LNG-powered vessels ranging from 9,200 to 16,800 TEU. Meanwhile, the company also plans to carry out methanol power conversion on five 10,000 TEU vessels next year.
In terms of freight rates and demand, Hapag-Lloyd expects its full-year transportation volume to maintain a moderate growth, benefiting from a strong performance in the first half of the year. Although spot freight rates have declined after peaking in the middle of the year, the increase in US tariffs has not reached the level that the market was worried about. With the implementation of the new tariff policy this month, the market has gained a clearer reference, which is expected to have a practical impact on the trend of cargo volume.
In the long term, tariffs are not beneficial to global trade. However, what is more crucial than specific tax rates is the predictability of the market. Over the past few months, most customers have been on the sidelines. Now, we have a clearer understanding of what is happening. Habben Jansen said.
Financially, Hapag-Lloyd expects its full-year earnings before interest, taxes, depreciation and amortization (EBITDA) to be between 2.8 billion and 3.8 billion US dollars. Strong performance in the first half of the year, higher reliability of schedules and continuous investment in the modernization and sustainable development of the fleet have become the main supporting factors.
It is worth mentioning that the Gemini alliance jointly launched by Hapag-Lloyd and Maskey has performed outstandingly, with the reliability of shipping schedules consistently maintained at around 90%. This year, there have been almost no large-scale port skipping, and the reliability of shipping schedules has significantly improved compared to the past. Although the weekly capacity has not increased significantly, it can ensure continuous deployment instead of frequent cancellations of voyages due to delays. Habben Jansen said.
