MSC Aims to Deepen Relationship with China Despite Looming U.S. Fees
MSC Mediterranean Shipping Company is expanding its relationship with China on multiple fronts as the company continues its unrelenting drive to expand and pull away from the pack in container shipping. The company celebrated last week the launch of a new ship management operation to be based in Ningbo, China, and is reported to have more than 70 vessels on order from Chinese shipyards, all despite the looming move by the U.S. Trade Representative to impose fees on Chinese-built ships calling in U.S. ports.
In an exclusive interview with the Ningbo Daily, Prabhat Jha, CEO of the newly launched MSC Ship Management (Ningbo) and MSC Crewing Services (China), highlighted the company’s deep relationship with Ningbo, which he also highlights as a center of the Chinese shipping industry. He calls the company “a big user” of the Ningbo port, noting MSC has a 16 percent market share in containers.
He reiterates that the company is looking to build new locations and needs new sources of crew and locations for crew training to support its growth plans. He says MSC currently employs about 700 Chinese seafarers and by 2026 it looks to grow this to 2,000 seafarers.
Historically, MSC has maintained its ship management operations in Cyprus and its headquarters in Switzerland. It manages chartered ships and a portion of its fleet of nearly 1,000 ships from Cyprus. The unrelenting drive of the past few years has seen the company surpass Maersk and now has a nearly 50 percent larger capacity, or over 6.7 million TEU.
The new Chinese companies will provide full services to support the fleet beyond just its operations in China. In addition to a location for crew recruitment and training, they will provide ship management services. Jha also notes China’s efforts to meet the shipping industry’s needs to achieve decarbonization.
As a private company, MSC rarely announces its shipbuilding plans, but multiple reports from brokers have tied the carrier to yet another round of large ship orders. In recent weeks, MSC has been linked to orders for six 22,000 TEU containerships to be built at two Chinese yards and another order, 3 + 3, for 21,000 TEU vessels. Chinese shipyards are believed to represent approximately half of the company’s total newbuild containership orders.
Alphaliner calculates that MSC has a total of 131 new vessels on order. They report that this represents 2.2 million in TEU capacity.
Jha told the Ningbo Daily that the company’s decision to set up the management and crewing operation in Ningbo was “closely tied to the scale, efficiency, and strategic location of the Ningbo-Zhoushan Port.”
All of this comes as the USTR is moving to finalize its plans for fees on Chinese-built ships. MSC seems unfazed by the U.S. efforts to break China’s dominance in shipbuilding and role in global shipping as it continues its own growth.