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Media: Price war not an option for Smedegaard

Maersk Line cannot afford a price war, says Nils Smedegaard Andersen, CEO of A. P. Moeller-Maersk, following the signs of an emerging price war in the container shipping industry, reports Reuters.

"It may be a little new to industrial thinking, but we just can't afford to go into a price war because the general market is going down," says Nils Smedegaard Andersen in an interview with Reuters.

The statement follows the realization last week that a price war on the container rates - caused by, among other factors, the decrease in American and European demand for Chinese goods - would be very damaging to the container shipping industry. Normally, the shipping industry would cut the rates when the economy goes down, but Maersk Line will not make that move this time, says Nils Smedegaard Andersen – this especially because the current Maersk Line rates does not cover the expenses on the Asia – Europe routes. Instead, the shipping company is looking to increase the rates a little bit, hoping to retain its market share instead of increasing it.

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