The Chinese conglomerate will purchase six mega-ships and eight other vessels for a total of $1.78 billion, according to a report from the China Daily.
China’s COSCO Shipping Corp. will purchase 14 more containerships in two deals worth a combined $1.78 billion, according to local news source China Daily.
Six mega ships will be purchased from Shanghai Waigaoqiao Shipbuilding Co with eight vessels purchased from Shanghai Jiangnan Shipyard (Group) Co. The 14 vessels are slated for delivery over the next two years, China Daily reported.
“Traditionally, Chinese shipping companies mainly transported containers on shipping lines between Asia and Africa, and China and Southeast Asia,” said Wan Min, general manager of China COSCO Shipping Corp., according to the report. “But we are now focusing on major shipping lines between Asia and Europe, and Asia and North and South America.
“Free trade arrangements, including the Regional Comprehensive Economic Partnership, the China-Association of Southeast Asian Nations Free Trade Agreement and China-Australia FTA, will also offer new growth opportunities for China COSCO Shipping’s container cargo services in the Asia-Pacific region,” he added.
COSCO Shipping Lines, the container carrier subsidiary of COSCO Shipping Corp., has an order out for 33 containerships that would add another 500,000 TEUs added to its total 1.64 million-TEU fleet.
The China Daily report also quoted Cheng Zhiwei, an analyst with Changjiang Securities Co., who said new orders for container ships will boost the company’s presence, but could also have a negative effect on the industry.
“The race for larger container vessels will delay the recovery of the industry as the global shipping sector has experienced rocky times in recent years,” said Zhiwei.
But Wang Mingzhi, deputy director-general of the Waterborne Transport Bureau at the Ministry of Transport, said an upgrade was a positive move.
“Better-equipped ships will help the company compete against international rivals,” said Wang.
The world’s top container lines, Maersk Line of Denmark, Mediterranean Shipping Co. (MSC) of Switzerland and CMA CGM of France hold a 40 percent market share globally, leaving Chinese companies with “a relatively small share in comparison,” according to Wan.
Correction: A previous version of this story indicated the order was worth $178 billion.