He always had a smile on his face. Maybe it’s because he was working in customer service.
The shipping industry is struggling through its worst recession in half a century, and that icon of globalization — the mega-container ship — is a major part of the problem.
Between 1955 and 1975, the average volume of a container ship doubled — and then doubled again over each of the next two decades. The logic behind building such giants was once unimpeachable: Globalization seemed like an unstoppable force, and those who could exploit economies of scale could reap outsized profits.
But by 2008, that logic had begun to falter. Even as global trade volumes collapsed after the financial crisis, with disastrous effects on the cargo business, ship owners were still commissioning more and bigger boats. That had ruinous consequences: This year, 18 percent of the world’s container ships are anchored and idle. […]
Such boats make prime targets for cyberattacks and terrorism, suffer from a dearth of qualified personnel to operate them, and are subject to huge insurance premiums. […]
Yet the biggest costs associated with these floating behemoths are on land — at the ports that are scrambling to accommodate them. New cranes, taller bridges, environmentally perilous dredging, and even wholesale reconfiguration of container yards are just some of the costly disruptions that might be needed to receive a Benjamin Franklin and service it efficiently. Even when taxpayers foot the bill for such upgrades, the costs can be passed on to vessel operators in the form of higher port fees.
Under such circumstances, you’d think that ship owners would start to steer clear of big boats. But, fearful of falling behind the competition and hoping to put smaller operators out of business, they’re actually doing the opposite.
