Maersk Line Cuts Pacific Southwest Capacity

Danish liner giant Maersk Line revealed plans to close its current TP5 service as of January 15th, 2015 amid unprofitable results.

The decision includes suspension of direct Taiwan Express product to the Pacific Southwest as of January 1st, 2015 as well.

Maersk Line said that this does not mean that the company’s commitment to the Transpacific trade has wavered.

“Over the last decade, the operating environment on the Transpacific has been challenging, with the overall trade delivering unprofitable results for nine of the last ten years leading some to question the long-term health of the trade. As a result, we have taken a detailed look at the economics of the trade with a focus on ensuring we secure our position,” Maersk said.

According to Maersk Line, the long-standing downward pressure on profitability in the Transpacific represents a serious risk to service levels.

“We will not take the lead but rely on the Transpacific Stabilization Agreement to address the profitability challenge to the benefit of all stakeholders. To ensure we provide the necessary coverage for our customers, all key corridors will continue to be serviced by alternate options,” Maersk Line added.

Clients using TP5 service today, North China and Korea markets will be covered by a new East-West network, launching this January, the liner company explained.

For the Japan market, effective from January 16th, 2015, Maersk Line said it would launch a new TP5 product with reduced capacity covering Busan, Yokohama, Los Angeles, and Oakland.