Analyst Ben Nolan believes lines have collectively overbuilt fleets of larger efficient vessels and are now being forced to compete on price rather than focus on margins.
“We expect the push to build up fleets will slow in the second half of 2015, and liners are likely to require fewer vessels as they seek to simply fill the ones they have,” he said in a report today.
“Consequently, we expect charter rates to fall and asset values to soften into the back half of the year and into 2016.”
Nolan counts 102 boxship newbuildings placed in the first half of 2015, of which 71 were over 10,000-teu and predominantly ordered by lines directly.
“With the major players completing their large fleet expansions and with low unprofitable freight rates, we expect incremental vessel orders should slow with the focus moving away from per box economics and more toward appropriate fleet size,” he said.
“However, the challenge is that orders over the past several years are almost certainly likely to lead to continued growth in the global fleet.
“As such, not only do we expect ordering of new vessels to slow, but we also expect charter rates could fall as ships come up for renewal and liners seek to right size the fleets.”
