Barely 10% of vessels operating on the Asia-Europe container trade will be less than 14,000 TEU capacity by 2020, according to SeaIntel.
The analyst said that 90 mega-vessels of more than 14,000 TEU were due to delivered in the next three years, a move that would push the percentage of mega ships on the lane up to 88%.
Assuming all current orders were delivered on time, any additional vessel orders in the 18,000+ TEU category would result in excess capacity on the trade while also reducing the number of services available to shippers.
“The current orderbook will result in a fleet of 125 vessels in excess of 18,000 by end-2020,” said SeaIntel.
“Assuming a healthy 5% demand growth in the coming three years, and also assuming the same degree of vessel utilization as seen in 2017, the Asia-North Europe trade will be fully covered by just 15 weekly services - essentially forcing each of the alliances to permanently eliminate one of their current services.”
With the Asia-Europe lane already close to the limit of what the trade can reasonably be expected to absorb until 2020 in terms of vessel upgrades, SeaIntel concluded that “further vessel ordering in the 18,000+ TEU category is highly likely to result in excess capacity issues”.