Red Sea torpedoes Hapag-Lloyd rates

Profits fall on Red Sea diversions, alliance start-up costs

(Photo: Hapag-Lloyd)

Hapag-Lloyd said container volumes surged 8% in 2025 from the previous year but the average price to carry a container of freight fell by the same percentage as operating costs soared on longer voyages away from the Red Sea.

The German company (HLAG.DE) said preliminary data showed revenues of $21.1 billion in the 2025 financial year, up from $20.7 billion y/y. Earnings before interest, taxes, depreciation and amortization (EBITDA) were $3.6 billion, off 1.4% from $5 billion, while earnings before interest and taxes came to $1.1 billion, down 1.7% to $2.8 billion.

The fifth-largest carrier by TEU capacity said its 2025 alliance with Maersk (MAERSK-B.CO) on the east-west Gemini Cooperation and robust trade growth boosted freight volume by 8% to 13.5 million TEUs. At the same time, the average freight rate fell by 8% y/y, to $1,376 per TEU. It cited higher costs due to the ongoing rerouting of ships away from the problematic Red Sea-Suez Canal and  around the tip of Africa, and start-up expenses for Gemini. 

The partners, with naval assistance, have restarted at least one scheduled service on the Red Sea route.

The company expects alliance cost savings to kick in during the second half of 2025 and will be fully realized in 2026. 

Hapag-Lloyd will report FY2025 earnings on March 26. 

Find more articles by Stuart Chirls here.

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Stuart Chirls

Stuart Chirls is a journalist who has covered the full breadth of railroads, intermodal, container shipping, ports, supply chain and logistics for Railway Age, the Journal of Commerce and IANA. He has also staffed at S&P, McGraw-Hill, United Business Media, Advance Media, Tribune Co., The New York Times Co., and worked in supply chain with BASF, the world's largest chemical producer. Reach him at stuartchirls@firecrown.com.