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China Shipping Container Lines (CSCL) and Orient Overseas (International) Ltd are facing a customer backlash as they impose extra charges and rate increases to stem losses in what may be the worst year for the shipping industry.
Due to plunging freight rates, Deutsche Bank forecast Hong Kong-listed CSCL will suffer a net loss of 3.04 billion yuan (HK$3.49 billion) this year while Hong Kong-listed OOIL will post a US$302 million loss, HK newspaper SCMP reported.
Attempts to reduce the red ink by passsing on the costs to shippers have been met with fierce opposition. Hong Kong, Macau and mainland China shippers have successfully persuaded some US and European buyers not to use OOIL because the lineimposed a so-called "seal charge", a reference to the lock on containers to ensure security of goods.
"Shipping lines in the past have never charged separately for these services," said Sunny Ho Lap-kee, the excutive director of the Hong Kong Shippers' Council. "There is general frustration against shipping companies that have ruthlessly resorted to introducing charges."
