Hapag-Lloyd shelling out more than half a billion dollars for containers

Hapag-Lloyd has ordered 150,000 twenty-foot equivalent units (TEUs) in an effort to combat slow turn times. The cost — about $550 million — represents one of the German ocean carrier’s largest container orders ever.

Import surges at U.S. ports, labor shortages caused by COVID-19 outbreaks and severe port congestion, particularly on the West Coast, all have contributed to a slow turnaround of containers to be sent empty back to Asia to be refilled.

Hapag-Lloyd said in the announcement it “needs significantly more than the normal number of boxes to carry the same volume because boxes are turning slower.”

CEO Rolf Habben Jansen explained in February, “Normally you would sail 12 days [to LA/Long Beach]. You unload two or three days and then you get the box back one or two weeks later from the customer. Today you sail 12 days, you wait for a week. The dwell time of the container is double what it is normally and then you have another delay on the rail side, so you easily lose a week or two weeks before you get the box back.”