Doing a Slow Steam

Here’s some of last week’s maritime news. [Hope that little fourth-grade girl doesn’t see this.]

1. “YRC Reports $ 622 Million 2009 Loss”
– “YRC Worldwide had a net loss of $ 622 million last year on $ 5.3 billion in revenue, the company said yesterday in its 10-K annual report … The $ 622 million loss was YRC Worldwide’s best performance – on paper – in four years. It has not had an annual profit since 2006.”

2. “APL Unit Borrows $ 300 Million”
– “Neptune Orient Lines said Tuesday that APL (Bermuda) Ltd., a division of its liner subsidiary APL, is taking a term loan of $ 300 million from a syndicate of banks and financial institutions.”

3. “Orient Overseas Posts $ 400 Million Loss”
– “Orient Overseas (international) Ltd., the parent of container line OOCL, reported a loss Friday of $ 400.6 million for the 2009 calendar year, compared to a profit of $ 275.5 million recorded in 2008 … ‘2009 presented the worst market conditions ever experienced in the container shipping industry,’ said OOIL Chairman C. C. Tung in announcing the Group’s 2009 financial results.”

In view of “the worst market conditions ever experienced …”, sound business moves by shipping lines would seem to be in order. In similar circumstances, merchants historically have lowered rates and offered improved services – like, for instance, greater efficiency and faster distribution. But not maritime merchants. Here’s how distressed lines are addressing their financial troubles:

1. “Containership Charter Rates Rising”
– “Carriers chase higher freight rates … Container charter rates are rallying as ocean carriers scramble for tonnage …”

2. “ESC’s New Maritime Council Chief Slams Slow Steaming”
– “Jean Louis Cambon, European Shippers’ Council’s new Maritime Transport Council chief, rebuked carriers for capacity cuts and slow steaming in his inaugural address on taking up his new post. ‘This has to be one of the few sectors that believed it can reduce quality while increasing prices … Carriers should pay more attention to their customer needs and take the time to learn about their businesses,’ he said”

If it’s not one wacky scheme it’s another. Bailout scams, stimulus programs, health care reform, cap-and-trade, slow-steaming, higher freight rates – all of these sure-fire moves are nothing but tricky smokescreens. Unless officials realize that the root cause of our planet’s failed economy is U.S. unemployment, even a mild recovery is out of the question. When American shipyards are building container ships – patented container ships – only then will we see an end to this economic collapse.