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German shipping giant Hapag-Lloyd says U.S. West Coast delays won’t substantively effect its results.
Retailers and manufacturers will be the ones who are most harmed by the backlog on the Hapag Lloyds’s trans-Pacific trade route, the company said. The National Retail Federation has predicted the ports would take six to eight weeks to clear the cargo congestion.
"Hapag-Lloyd isn’t seeing massive declines in a way that it is jeopardizing our results," said spokesman Nils Haupt, without providing figures. "It is particularly dramatic for manufacturers, whose goods need to reach a destination at a fixed date."
The container line generated $1.8 billion in revenue from trans-Pacific trade in 2013, making it the company’s most important trade route, followed by the Atlantic, Latin America and the Far East.
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The carrier canceled 36 sailings between North America and Asia in the three months to May 17, it said on Feb. 18. All vessels affected are operated by G6 alliance partners APL, Nippon Yusen Kaisha and Orient Overseas Container Line, according to Haupt. "We have storage capacity on those vessels," he said.
At 17 percent, Hapag-Lloyd has the lowest capacity on the Far East-North America route among all G6 partners, said Thomas Wybierek, a shipping analyst at Germany’s Norddeutsche Landesbank.
Hapag-Lloyd doesn’t expect to turn a profit until next year. It intends to launch an initial public offering at the end of this year or in 2016, following its merger with Chilean container line CSAV last year.
For more of the Bloomberg story: www.bloomberg.com
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