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Orient Overseas (International) Ltd (OOIL), a Hong Kong-based container ship operator, said it has cut its capacity on routes to Europe by 20 percent and is not optimistic on the industry outlook for next year.
"The shipping industry started losing money in the third quarter," chairman and chief executive Tung Chee Chen told reporters on the sidelines of a logistics and maritime conference in Hong Kong, reported Reuters.
He said OOIL did not need to report third-quarter results and declined to comment on the company's results in the last quarter.
"The outlook will eventually depend on Europe's situation, and whether the debt crisis can be resolved," Tung said. "But in consideration of today's situation, next year will not be optimistic."
He added that the Grand Alliance, members of which include Germany's Hapag-Lloyd, Japan's NYK and OOIL shipping unit OOCL, had cut European capacity by one loop to three loops.
One loop had 10 ships and the cut represented about 20 percent of OOIL's European capacity, he said.
"Operating costs are high as fuel and fuel-related costs are rising and even higher than in 2009, although business is not as bad as in 2009," Tung said.
Some analysts said they believed OOIL could outperform the container shipping market but were doubtful it could avoid losses in an industry downturn in 2012.
Cargonews Asia
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