Lloyd’s List: Why the big fuss over the Triple-E?

Monday, 21 March 2011 00:01 -     - {{hitsCtrl.values.hits}}

In her recent article ‘Maersk drives home clean shipping message’, Lloyd’s List’s Janet Porter asks why in an industry where low-key announcements are the norm has Maersk Line deliberately courted publicity.  

Janet Porter hailed the announcement of the Triple-E purchase as “a stunning public relations success.”

The London press conference, attended by many mainstream media including television and radio as well as shipping journalists, was the platform for Maersk Line CEO Eivind Kolding and Daewoo Shipbuilding & Marine Engineering’s president Nam-Sang-Tae to convey the Triple-E key messages — Energy efficiency, Economy of scale, and Environmentally improved.

However, Porter suggests a number of reasons for making such a publicity splash on a normally secretive topic.

She asserts that the Triple-E purchase is Maersk Line’s bid to clearly “send a message to the competition that it is determined to remain the market leader, and that any thoughts that it could be knocked off its perch should be banished.”

In addition, the fact that the Triple-E vessels will have a slot cost expected to be 26 % less than the 13,000 TEU ships now being delivered to competitors demonstrates that although Maersk Line has the ambition to be “shippers’ first choice in terms of customer service and reliability, in the world of container shipping, price is always paramount” — and, as she writes, this much reduced slot cost will “make competitors sit up and take note.”

Speaking out

Porter also reckons that policymakers, regulators and environmentalists — who she describes as a target audience that is “convinced that shipping is a dirty, mucky business that is polluting the world’s oceans and the air we breathe, and that ship owners are a bunch of secretive spivs who refuse to accept responsibility for the damage they cause” — will take note of the “startling characteristics” of the Triple-E.

She adds that Maersk has decided to “speak out” about some of the very positive developments in the shipping industry of which the outside world is largely “unaware”, quoting Group CEO Nils S. Andersen, who says that the Group is “doing a lot on a number of fronts, including the environment … and we want to draw attention to that.”

The conclusion is then that this all adds up to Maersk Line being an “undoubted pioneer in the world of container shipping”, as Porter puts it; but, there was something she picked up on in an interview with Eivind Kolding that makes her doubt the ability of other lines to follow.

While Eivind stated to her that he would “welcome the development” if competitors also focused as much on the environment, she writes that Maersk has in effect “priced many competitors out of the market.”

Porter describes how the USD 190 million cost of the giant Triple-E is only slightly higher than competitors’ outlay on ships in the 13,000–14,000 TEU range — so for these lines to follow suit on Triple-E is a challenge.

She notes that Eivind himself has heard of no other lines looking for 18,000 TEU ships — “MSC has already discounted interest” she writes — while, for other carriers, raising finance for such an investment is “probably difficult.”