Chinese shipping company Cosco Holdings Co. has agreed to order 11 container vessels, each with a capacity of 19,000 teu, for a total of US$1.5bn in an attempt to cut costs.
The ships are expected to be delivered in 2018, Cosco said in a stock exchange statement on Wednesday (9 September).
Cosco now becomes the fifth largest global shipping line in terms of market share, when existing fleet and current orderbook are combined, overtaking Hapag-Lloyd.
The order is the latest in an industry trend of ultra-large container vessel (ULCV) investment despite the overcapacity already plaguing container shipping.
Within the past few months, alliances including 2M, Ocean Three and the G6 have removed sailings on the Asia-Europe trade route, owing to declining freight rates.
So far this year, Hong Kong-based Orient Overseas Container Line (OOCL) has ordered six 21,100 teu-capacity container ships, with an option for a further six, while the Japan-based Mitsui OSK Lines (MOL) announced plans to add six 20,000 teu vessels to its fleet.
French shipping line CMA CGM ordered at least three 20,000 teu container ships, with delivery scheduled to begin in 2017, while Copenhagen-based Maersk Line ordered 11 second generation Triple-E ultra-large containerships, with an option to add six more.