SHIPPING AND SHIP MANAGEMENT SkySails is a kite towing system that is said to reduce fuel costs by <strong>10</strong>–15 per cent. Many shipping companies meanwhile have increased their own intakes of trainees and created new training facilities on ships. Among those to announce expanded training of late have been Hamburg Süed, Beluga and Reederei NSB. Reederei Gerd Bartels has donated modern engine parts to a local training establishment so that students can use up-to-date equipment. Problems the past year Three of Germany’s biggest shipping companies have faced problems this past year. Hapag-Lloyd experienced losses, Hamburg Süd reported difficulties and Senator Lines saw service and job cutbacks. Hapag-Lloyd, with 141 container ships of more than 480,000 TEUs, has had a downhill struggle with its integration of CP Ships, posting a loss of EUR <strong>10</strong>6 million in 2006 after two years of record earnings. Declining rates and CP integration costs led to the loss, which contrasted with a profit of EUR 319 million in 2005. Increased bunker, landside logistics and charter rate costs also cut profits, Hapag- Lloyd parent TUI reported. At the same time however turnover was up 63.1 per cent to EUR 6.3 billion in 2006 because of the CP acquisition and volume rose from 4.8 to 6 million TEUs. <strong>No</strong>w that integration is complete, resilient Hapag-Lloyd can surely look forward to a restoration of fortunes. TUI predicted an operating profit of EUR 400–500 million for shipping next year. It said it expected an 8–9 per cent increase in container shipping volume this year and in 2008 with sales of up to seven billion Euros in fiscal 2007. It also says expected synergy savings of some EUR 220 million from CP will kick in this year. A good step towards better business has been made this year by Hapag-Lloyd with a strengthened China-Red Sea service and a new Asia-Black Sea service. Stiffening the Europe-Far East fleet are two new 8,750 TEU ships with the Grand Alliance, the first of five. Hapag-Lloyd’s Adolf Adrion speaks for all: “China is the engine of the world economy and globalisation and thus also drives ocean shipping”. Speculation about Hapag-Lloyd ownership, however, given the current ups, and earlier downs, of TUI, continues to fuel the fantasies of commentators. <strong>No</strong> takeover There was a time when a merger between a dominant Hapag-Lloyd and Hamburg Süed looked possible. <strong>No</strong>w August Oetker has been quoted as saying his Group, the parent company of Hamburg Süd, has no interest in a take-over of Hapag-Lloyd. The German reefer specialist has however moved in other directions to strengthen its position. It has intensified co-operation with Maersk on north-south America container services and with Maersk and NYK in Asia–South America service. It has also doubled the capacity on its new Trident service between Europe/Australia–New Zealand. Hamburg Süd has predicted handling this year of 1.9 million TEUs, including about 2<strong>10</strong>,000 reefer containers, after what Board Member Joachim Conrad described as a “difficult” but “still satisfactory” year. Volume in 2006 rose 21 per cent, or more than twice the market average, to 1.84 million TEUs from 1.52 million TEUs in 2005. Conrad acknowledged that two thirds of the growth came from acquired Russian shipping firm Fesco. Turnover in 2006 rose 5.2 per cent to EUR 3.2 billion, 85 per cent of which came from liner trades which showed ‘only’ eight per cent growth last year after a much bigger increase in 2005. One main reason for the decline was rates, which Hamburg Süd said came under considerable pressure. Hamburg Süd liner shipping slot capacity grew slightly to 201,000 TEUs in 2006 and the company operated 88 container ships by year’s end, in a total fleet of 139 ships also including 51 bulk carriers and product tankers. Digesting huge costs In addition to the ten Monte Class 5,500 and 5,900 TEU newbuildings for delivery in 2008, Hamburg Süd has just this year also ordered six more 6,300 TEU Santa Class ships. Reportedly costing EUR 380 million, they are due into service from 2009. As usual, Hamburg Süd revealed no profit figures. It indicated however that German shipping future? Experts differ. 58 SCANDINAVIAN SHIPPING GAZETTE • MAY 21, 2007
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