Horizon Lines, the largest U.S. domestic ocean carrier, will launch a weekly trans-Pacific service from China to the West Coast in December after the expiration of a space-charter agreement with Maersk Line.
The new service will use five 2,824-TEU, 23-knot ships that now call at Guam in Horizon’s domestic service and continue on to China. Maersk now charters space on the vessels from Guam to China and from Chinese ports to the United States.
After the carriers' current space charter expires Dec. 10, Horizon will market its services in China directly to customers instead of acting as a wholesaler of vessel space to Maersk. Because the ships are already in the trans-Pacific, the change won't increase overall capacity in the trade.
Matson Navigation, Horizon's chief competitor in the Hawaii-Guam trade, sends its ships from Guam to China and back to the United States under a similar arrangement.
Horizon expects its international service to generate about 10 percent of the company's annual revenue, which was about $1.3 billion last year. In addition to Hawaii and Guam, the company operates in the Puerto Rico and Alaska trade lanes.
Horizon officials said its trans-Pacific service will target customers who want fast transits and reliable service but have been frustrated by larger carriers' decisions to slow their ships to deal with excess capacity.
“We believe the time is right: container rates in the Pacific trade lane have bottomed out and are rebounding; China’s economy is showing solid signs of recovery; and many major importers have reported that their service needs are not being met," said Horizon CEO Charles G. Raymond.
"We're not going to pose ourselves as a discount carrier in the trade. We're going to pose ourselves as a high-service carrier," Raymond said. "We are a full-service logistics provider. This is not just a port-to-port service that we're talking about here."
Horizon said it hasn't decided on Chinese ports or vessel rotations but expects to offer direct transits to the West Coast of about 11 days from China's central coast or 12 days from South China.
Groundwork for the new service was laid by sister company Horizon Logistics, which established a non-vessel-operating common carrier in China in 2007.
Brian Taylor, president and chief operating officer of the logistics unit, said relationships that the NVO developed provide "a very strong jump-off point" for Horizon in China.
Taylor, a 26-year veteran of the company, will oversee the new Asia service as senior vice president, international services, of Horizon Lines, and the logistics unit will no longer be reported as a separate business segment.
The new service will use five 2,824-TEU, 23-knot ships that now call at Guam in Horizon’s domestic service and continue on to China. Maersk now charters space on the vessels from Guam to China and from Chinese ports to the United States.
After the carriers' current space charter expires Dec. 10, Horizon will market its services in China directly to customers instead of acting as a wholesaler of vessel space to Maersk. Because the ships are already in the trans-Pacific, the change won't increase overall capacity in the trade.
Matson Navigation, Horizon's chief competitor in the Hawaii-Guam trade, sends its ships from Guam to China and back to the United States under a similar arrangement.
Horizon expects its international service to generate about 10 percent of the company's annual revenue, which was about $1.3 billion last year. In addition to Hawaii and Guam, the company operates in the Puerto Rico and Alaska trade lanes.
Horizon officials said its trans-Pacific service will target customers who want fast transits and reliable service but have been frustrated by larger carriers' decisions to slow their ships to deal with excess capacity.
“We believe the time is right: container rates in the Pacific trade lane have bottomed out and are rebounding; China’s economy is showing solid signs of recovery; and many major importers have reported that their service needs are not being met," said Horizon CEO Charles G. Raymond.
"We're not going to pose ourselves as a discount carrier in the trade. We're going to pose ourselves as a high-service carrier," Raymond said. "We are a full-service logistics provider. This is not just a port-to-port service that we're talking about here."
Horizon said it hasn't decided on Chinese ports or vessel rotations but expects to offer direct transits to the West Coast of about 11 days from China's central coast or 12 days from South China.
Groundwork for the new service was laid by sister company Horizon Logistics, which established a non-vessel-operating common carrier in China in 2007.
Brian Taylor, president and chief operating officer of the logistics unit, said relationships that the NVO developed provide "a very strong jump-off point" for Horizon in China.
Taylor, a 26-year veteran of the company, will oversee the new Asia service as senior vice president, international services, of Horizon Lines, and the logistics unit will no longer be reported as a separate business segment.