Maersk bemoans rate undercutting that hurts market

AP MOLLER-MAERSK Group CEO Nils Andersen has declared he will not allow rivals' price cutting to take market share from Maersk Line, the world's biggest container shipping carrier.

"We're ready to fight it out on prices," Mr Andersen told the Danish newspaper Dagbladet Borsen. "However, we don't believe it serves a purpose in a market in which there is no money to be made fighting for market share and thereby hurting the market."

The interview came after a results conference revealed that Maersk Line lost US$829 million in the first half on a seven per cent decline while the whole group loss stood at $540 million.

Mr Andersen said liner shipping industry has acted "immaturely" in response rate cutting, while at the same time saying that Maersk's pricing wasn't "out of the range of the competition."

Maersk's second quarter rates fell 34 per cent compared to the same period a year earlier, which an American Shipper report described as being a fall greater than the industry average.

But Mr Andersen said the greater loss was because of substantially falling rates on the Asia-Europe trade, which represents Maersk's core business.

(www.schednet.com)