Hapag-Lloyd Places New Order for Ultra-Large Containerships

Hapag-Lloyd has ordered another six ultra-large containerships in South Korea.

The vessels, ordered from Daewoo Shipbuilding & Marine Engineering (DSME), will have capacity of more than 23,500 TEU with dual fuel engines that can operate on LNG fuel. Deliveries are expected to commence in 2024.

The ships have been financed through a syndicated green loan in the amount of $852 million with a maturity of 12 years from delivery. The company said the medium-term goal is to have ships operate using “climate-neutral” synthetic natural gas (SNG).

The order adds to another identical order placed in December 2020, which the company said will cost around $1 billion with financing secured. Deliveries of those vessels will take place in 2023. All 12 ships will operate on Europe-Far East routes.

“With this investment in the additional newbuildings, we want to take another step in the ongoing modernization of our fleet – in terms of both ship size and sustainability,” said Rolf Habben Jansen, CEO of Hapag-Lloyd. “At the same time, we want to meet the persistently high demand and reduce our slot costs.”

Hapag-Lloyd is the world’s fifth largest containership operator with about 7.2 percent market share. Since its first order, the company has seen a strong start to the year with a net profit of $1.45 billion in the first quarter of 2021.

“On the back of the high demand for container transports, we have benefited from better freight rates, especially in the spot market. On top of that, bunker prices have been lower than in 2020,” said Jansen upon the release the company’s Q1 financials.

“Nevertheless, due to the demand-related congestion of port and hinterland infrastructures in many places as well as to a resulting shortage of freely available ships and containers, the transport volume was slightly below the level of the same quarter of the prior year, at roughly 3.0 million TEU, or minus 2.6 percent,” Jansen said.

In recent months, Hapag-Lloyd has also placed orders for 210,000 twenty-foot equivalent containers (TEU) amid the container capacity crunch in Asia and around the world.

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