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De Trenck: Obsolescence and container shipping

Hong Kong: Analyst Charles De Trenck tells Maritime CEO readers that the container sector is set for more choppy waters. The former Citi transport analyst says: “Containerisation has been one of the most persistent forces in disruptive technology and economics for the last 50 years. And even though it has moved to a mature phase – containerization still has a little disruptive power left in it.”
A big issue for De Trenck is the growing obsolescence in the sector as ever-larger boxships come out of Asian yards.
“Supersizing has generally increased since the 2008 global financial crisis and has gone hand in hand with obsolescence,” he says.
Looking purely at the orderbook, vessel size growth appears to be running three times the overall fleet growth rate, according to De trenck. Using monthly deliveries to 2016 he has mapped out the forward average vessel growth rate at about 15% over the coming 2-3 years.
“We have a big growth spurt coming up in 2014-15,” he explains, adding: “We then have a bit of a slowdown, but this is also partly based on not yet fully complete data on 2016-17 orders, though at the same time we do appear to have a bit of a re-acceleration in deliveries by mid-16.”
Looking further ahead, De Trenck thinks container shipping will be less high profile.
“Logistics will have a changed but still dominant role in transport, with containerisation a more generic sub-plot though still active player. Containerisation will continue to see a variant of Moore’s Law applied aggressively until Koreans, Chinese, Japanese, European and other carriers prostrate themselves at the foot of the God of Consolidation,” he concludes. [12/03/14]

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