Affected by the global economic downturn and weak market demand, the profits of major liner companies in Q4 2022 have dropped significantly. Maersk’s freight volume in the fourth quarter of last year was 14% lower than that of the same period in 2021. This is the worst performance of all carriers that have released financial reports so far. , so the transpacific TP20 pendulum service will be suspended until further notice.

The voyage cancellation strategy adopted by ocean shipping lines to cushion the impact of extremely weak demand after the Chinese New Year holiday and to curb the decline in spot freight rates for containers has also apparently not been successful. Shipping lines are now having to consider suspending services on routes from Asia where demand is weak, the future looks uncertain with no signs of improvement, and sailing has become uneconomical.

Maersk’s current actions show that bookings for trans-Pacific carriers are dwindling at North American ports on the Pacific and Atlantic coasts. The TP20 pendulum service is Maersk’s weekly service starting June 2021 during peak demand to target the lucrative premium market. At the time of launch, the loop line called at the port of Vung Tau in Vietnam, the ports of Ningbo and Shanghai in China, as well as the ports of Norfolk and Baltimore on the east coast of the United States. It passed through the Panama Canal and mainly deployed Panamax vessels with a capacity of 4,500 TEU.

World-renowned investment bank Jefferies (Jefferies) analyzed that most liner companies are currently at a loss in terms of market capitalization. Jefferies called on carriers to take “significant supply responses” to properly size the market.

Analysts at Sea-Intelligence, a Danish maritime consulting agency, believe that the news of the dissolution of the 2M alliance between Maersk and MSC will increase the competitive pressure on global liners. As a result, the risk of a protracted price war in 2023 will increase. One sign of this is that carriers are still not seeing positive performance from the post-Chinese New Year suspension as freight rates continue to slide.