The largest container shipping line in the world, A.P. Moeller-Maersk A/S, announced that it is cutting 19 ships from Asia-Europe trade lanes as demand falls and expenses rise.
Bloomberg reported Friday that Copenhagen-based Maersk is permanently eliminating its AE5 service and its eight vessels. Its AE9 route, with 11 ships, will not sail again until early December. Maersk, which cut 9% of capacity in February, thus brings the total cut for the year to 21%.
London-based ship broker ICAP said in the report that the drop in demand from Europe thanks to the debt crisis caused Asian container rates to drop below the break-even point. In a statement, Maersk said that with continuing weakness in the economy, volumes could fall 3% for 2012 as a whole, and as a result the company might remove more ships and cut sailing speeds to further manage capacity.