Maersk has undertaken a major strategic pivot, launching a large-scale shipbuilding program in an effort to avoid being overtaken by CMA CGM as the world's second-largest container shipping company.

Data from shipping data agency Alphaliner shows that the Danish company placed orders for 26 new vessels in September, each capable of carrying 18,600 standard twenty-foot containers; with this, Maersk's total number of vessels under construction and awaiting delivery has reached 131.

This decision marks a major strategic turning point for Maersk. For most of the past decade, Maersk focused on developing door-to-door end-to-end logistics services; now, faced with competitors using the hefty profits brought by rising freight rates to expand their fleets, Maersk has been forced to keep pace with the expansion.

Maersk Chief Executive Vincent Clerc said in September that the Danish blue-chip company "needs more ships" to cope with persistent trade disruptions, and that Maersk will "take a more proactive and aggressive stance" in the market. Christian Richly, Chief Operating Officer of Norwegian shipowner MPC Container Ships, said: "Comparing the current orderbooks and fleet sizes of the various players, the real competitive focus is actually between the number two and number three."

Maersk's batch of new vessels will be delivered gradually in 2029-2030, and once delivery is complete the total fleet will reach 882 ships, a 16% increase over its current total capacity. But the new orders are still unlikely to narrow the gap with the industry leader Mediterranean Shipping Company (MSC). MSC overtook Maersk in 2022 to claim the global number one spot, and Alphaliner data shows its current fleet has 1,015 vessels.

CMA CGM is also closing in steadily. The French family-owned company was once on the brink of bankruptcy after the 2008 financial crisis, but has expanded aggressively in recent years and holds 160 vessels under construction. If existing fleets are combined with vessels on order, CMA CGM's total capacity already exceeds Maersk's. Last month, a brand-new 400-meter-long CMA CGM container ship made its first visit to a British port, and Nicole Chamard, CMA CGM's Vice President for the Asia-Europe route, said at the event that the company becoming the world's second-largest container shipping company next year is already an "established fact."

Peter Sand, chief analyst at maritime research firm Xeneta, said: "CMA CGM has always been the one chasing the industry leaders." Since the outbreak of the COVID-19 pandemic and through the tensions in the Strait of Hormuz, persistent trade disruptions have pushed up shipping companies' freight revenue, and major container lines have used this windfall profit to buy new ships. Supply chain disruptions have raised freight rates and also lengthened vessel voyage distances. Shipping companies have set record-high new ship order volumes, betting that geopolitical conflicts, tariffs, and extreme weather will continue to support a shipping boom.

Maersk has already raised its profit forecast twice this year, when the company had originally expected a loss. Since the pandemic, Maersk's fleet size has expanded by about one-fifth. But over the past decade it has taken a different path from its rivals, focusing on building a factory-to-consumer end-to-end logistics system. The original intent of this strategy was to withstand the cyclical fluctuations of the container shipping industry; but now Maersk has changed tack, betting that freight rates will remain elevated for a longer period.

Clerc said that between 2000 and 2020 the shipping industry's booms and busts were basically symmetrical: whatever companies earned, they would lose back when the market turned down. But he believes that various disruptions such as port congestion have created a "natural floor" for freight rates, allowing corporate profitability to be significantly higher than in the past, with average industry returns expected to remain high.

Meanwhile, Hapag-Lloyd, which is in the same alliance as Maersk, has finalized a $4.2 billion acquisition of Israeli shipping company ZIM, and after the deal is completed its fleet will exceed 400 vessels. During the pandemic shipping boom, MSC bought large numbers of new and second-hand ships, not only riding that wave to become global number one but also terminating its alliance cooperation with Maersk in 2015.

Lars Jensen, Chief Executive of consultancy Vespucci Maritime, said: "All shipping companies must find their own positioning for the 2030s. Should they start a round of expansion and take an independent development path?" But he also pointed out that the shipping industry is a zero-sum game, and it is impossible for all companies to grow indefinitely.

Following in the footsteps of its peers, Maersk has chosen large vessel types for its new ships, relying on economies of scale to dilute unit costs. Industry executives say fuel costs account for two-thirds of total shipping costs, and only by operating larger, more energy-efficient vessels can companies lower freight rates. Richly said: "Double the ship size and unit costs can fall by about 25%—that is the underlying logic for the whole industry expanding ships."

But Maersk deliberately avoids purchasing the largest container ships on the market. CMA CGM's 10 new ships are larger, with each vessel's capacity reaching 24,212 TEU, among which the "Notre-Dame de Paris" is powered by liquefied natural gas and is currently the largest container ship operating under the French flag. In February this year, Maersk announced an order for eight 366-meter-long vessels, saying this ship type offers "greater flexibility" compared with the largest container ships currently under construction and can be deployed across multiple routes in its existing and future global network. The world's largest container ships are about 400 meters long and, constrained by port conditions, cannot dock at all terminals.

Some industry executives worry that collective fleet expansion will create future overcapacity. Excess ship supply would depress freight rates, and shipping companies could face huge losses; but many shipping practitioners say the risk can be hedged by slow steaming and idling vessels. Jensen said: "Vincent Clerc is very optimistic, believing there will not be overcapacity but rather a capacity gap, and that shipping companies will be able to absorb the massive orderbook. But I am skeptical about that."