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The “Berlin Express” will be christened in Hamburg today – the largest German container ship to date. But that cannot hide the fact that domestic seaports are finding it difficult to compete.
It is currently the largest container ship flying the German flag: The approximately 400 meter long giant freighter “Berlin Express” from Hapag-Lloyd, built in South Korea, will be christened today in its home port of Hamburg. The godmother is Elke Büdenbender, the wife of Federal President Frank-Walter Steinmeier.
The world’s fifth-largest shipping company, in which Hamburg-born billionaire Klaus-Michael Kühne also has a 30 percent stake, doesn’t really feel like celebrating at the moment. Kühne and Hapag-Lloyd boss Rolf Habben Jansen are upset about the city’s latest plans for Germany’s largest seaport. And the ver.di union and employees also protested against it.
Controversial partial sale to MSC
Hamburg wants to sell part of one of the country’s most important logistics hubs to a competitor of Hapag-Lloyd. Mayor Peter Tschentscher announced a good three weeks ago that the Mediterranean Shipping Company (MSC) would take over 49.9 percent of Hamburger Hafen und Logistik AG (HHLA). According to the agreement, the remaining 50.1 percent remains with the Hanseatic city.
They had been looking for investors for the terminal operator HHLA, but wanted to retain the majority of the company. The Swiss shipping company MSC was prepared to accept this – in contrast to billionaire Kühne, who had previously also expressed interest in HHLA.
Port of Hamburg is losing market share
Hamburg is under great pressure to find donors for necessary investments in the port infrastructure. Container throughput in the Port of Hamburg fell by 11.7 percent to 3.8 million standard containers in the first half of 2023 compared to the same period last year. Hamburg is only the third largest port in Europe behind Rotterdam and Antwerp.
A total of around 14.5 million standard containers were handled in Rotterdam last year, and around 13.5 million standard containers were handled in Antwerp. In Hamburg, on the other hand, only around 8.3 standard containers passed the quay edges in the entire year of 2022. While container throughput in Antwerp and Rotterdam increased by more than 40 percent between 2007 and 2021, Hamburg saw a decline of 12 percent.
Transshipment in Rotterdam is significantly cheaper
This is also due to the geographical advantages of the ports in Rotterdam and Antwerp. The port in Rotterdam is located directly on the coast, and the terminals are located directly on the deep water. The world’s largest container ships can reach it without restrictions.
The “Berlin Express”
With a length of almost 400 meters, a width of 61 meters and a transport capacity of 23,664 twenty-foot standard containers (TEU), the “Berlin Express” is one of the world’s largest container ships. Hapag-Lloyd ordered the ship with five sister ships from the South Korean shipyard Hanwha Ocean (formerly Daewoo) at the end of 2020, and an order for six more ships followed six months later. The freighters can run on liquefied natural gas (LNG) or conventional fuel. Internally, the ship class is called “Hamburg Express”. Hapag-Lloyd has already taken delivery of another ship from the class, the “Manila Express”.
In contrast, the port of Hamburg is 100 kilometers inland. Megamax container ships like the “Berlin Express” with a length of 400 meters and a draft of more than 13 meters have to use the tidal wave to travel on the Elbe. And: Some ships cannot even enter the harbor when fully loaded.
In addition, there are home-made problems. “The handling of a box costs up to 30 percent less in Rotterdam than in Hamburg,” said Jan Ninnemann, logistics professor at the Hamburg School of Business Administration, to the “Süddeutsche Zeitung”. The higher costs are due to the lack of automation of the processes.
There is a lack of productivity
This ultimately leads to falling productivity: in the recently published Container Port Performance Index (CPPI), which the World Bank publishes together with S&P Global Market Intelligence, the port of Hamburg has fallen almost 100 places within a year. Of the 348 ports examined worldwide, it only came in 328th in the ranking for 2022. The other two large German seaports performed significantly better in terms of productivity: Bremerhaven came in 60th, Wilhelmshaven in 118th.
But these two ports are also struggling with shrinking container throughput. Transshipment in Bremerhaven fell by almost 25 percent between 2012 and 2022 to 4.6 million standard containers per year. In Wilhelmshaven it has also recently fallen – to just over 685,000 last year. The relatively young deep-water port is therefore far from being fully utilized.
competition among the ports
The port of Hamburg is now set to receive a boost from the alliance with MSC. The world’s largest shipping company, based in Switzerland, has pledged to significantly increase its cargo volume in Hamburg – to at least one million standard containers per year from 2031. Bremerhaven could suffer. The cargo could be missing there in the future. MSC has so far conducted a large part of its German container business in Seestadt.
The competition between German ports is fierce – and the latest plans for the terminal operator HHLA have only fueled it. The idea of a German port alliance, as demanded by parts of the economy, now seems even more unlikely. Lower Saxony’s Economics Minister Olaf Lies and the Chamber of Commerce in Bremen have advocated that the German seaports of Hamburg, Bremerhaven and Wilhelmshaven work more closely together in order to improve their competitive position compared to Rotterdam and Antwerp.
More funding required from the federal government
But so far it looks like more rivalry between the seaports instead. And it is uncertain whether the German ports will ultimately be able to secure more cargo. The shipping company Hapag-Lloyd, which was left out by MSC when HHLA joined, is thinking about reducing transport volumes in Hamburg – and shifting container handling to Bremerhaven or Wilhelmshaven instead.
This has led to criticism that the federal government needs to become more committed to German seaports – for example recently at the “National Maritime Conference” in Bremen. The Hamburg CDU members of the Bundestag Franziska Hoppermann and Christoph de Vries pointed out that the ports only received around 38 million euros from the federal government annually. Funding has not been increased for almost 20 years. According to a position paper by the Christian Democrats, it is necessary for the federal government to support the seaports with “at least 500 million euros annually”.