@Risk

NYK says it will further reduce the size of its container ship and car carrier fleets, while it directs attention and focus to its non-asset-based business “for the time being,” according to a report today at The Journal of Commerce.

The company has already made significant reductions. Last year, for instance, the company cut its container fleet from 115 ships of 410,000 20-foot units (TEUs) to about 90 ships with a capacity of 360,000 TEUs. Likewise, its car carrier fleet has been reduced from 130 vessels to approximately 9o.

Although analysts expect cargo traffic to begin increasing, many companies like NYK are starting the year in the shadow of enormous deficits. It’s no surprise, then, that transportation executives appear to be eyeing  hints of an economic rebound with extreme caution. Carriers are reportedly planning to restrict any additions of new capacity for the rest of the year until concrete signs of economic growth emerge.

Of course, that’s certainly a reasonable approach if you’re a shipper who’s watching the bottom line. But, buyers need to take note. It looks like you can continue to expect less flexibility, availability and customer service. Plus, shipping prices will likely skyrocket if demand suddenly increases.