New World Alliance to drop transpacific loop

   The New World Alliance is withdrawing a transpacific service this month due to 'slowing demand for retail merchandise and corresponding reductions in inventory replenishment by retailers,' NWA member Hyundai Merchant Marine said Thursday.
   The Hyundai-operated PSW service was restarted in May 2010 in anticipation of 'expected growth of 2010 trade volume for Northeast Asia.'
   That optimism ahead of peak season last year has given way this year to lower expectations.
   'Softening consumer demand is giving importers cause to retrench in regards to inventory levels previously planned for the upcoming holiday shopping season', said Lamont Petersen, vice president of marketing for Hyundai Merchant Marine.
   Petersen added that economic growth seems to be slowing to a crawl due to myriad factors, including the weak housing market, high unemployment, growing inflation and uncertainty surrounding possible federal austerity programs in the United States.
   'Volumes of imported goods are being negatively impacted,' she said.

Hyundai said NWA carriers would accommodate space requirements on the alliance's remaining transpacific strings that duplicate the PSW's ports of call. Other NWA members are APL and MOL.
The rotation for the PSW is Kaohsiung, Xiamen, Hong Kong, Yantian, Busan, Los Angeles, Oakland, Busan and Kaohsiung. The service has operated with five Hyundai vessels with an average capacity of 4,495 TEUs, according to American Shipper affiliate ComPair Data.

   The alliance also said its PCX transpacific will make a single call at Hyundai's California United Terminal in Los Angeles, while a secondary call at the Trapac Terminal in Los Angeles will be dropped, to reduce transit times on the PCX by one day.
   The PSW is the second transpacific service in a month to be dropped, with CSAV suspending its ASIAM service to the U.S. West Coast at the end of June, though that service included calls in India and Southeast Asia.
   The New World Alliance had attempted to scale back transpacific capacity in the slack season by omitting sailings rather than outright suspension of any services. ' Eric Johnson

FreightWaves Staff