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Rivals To Absorb Closed Shipper's 15% Market Share

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

Some 13 Bahamian jobs will be lost through a shipping line’s closure, although the Nassau Container Port’s chief executive yesterday said its 15 per cent market share would be absorbed by other carriers.

Atlantic Caribbean Lines’ (ACL) decision to shut down its operations in the Bahamas, US and Caribwas confirmed by a local company executive yesterday.

Garth Rolle, ACL’s Nassau port director, confirmed to Tribune Business via e-mail that the Florida-based company’s last port call was on Friday past. 

Mr Rolle said: “The decision was made by the ownership team to cease operation with immediate effect.”

He added that 13 employees between its Grand Bahama and Nassau offices would be left out of a job.

The exact motives for the pull-out were unclear, but Mike Maura, chief executive of Arawak Port Development (APD), the Nassau Container Port operator, told this newspaper previously that shipping companies had lost much money over the last several years given the up to 50 per cent drop in freight/container rates and fees.

It is likely that ACL was being squeezed on several fronts, the drop in freight rates combining with a major increase in competition from other carriers as the likes of Mediterranean Shipping Company (MSC) entered the Bahamas market.

Mr Maura told Tribune Business yesterday that no indication had been given as to why ACL had shut down.

He told Tribune Business: “They have closed the company, which includes their US, Freeport and Nassau operations. This follows the company’s exit from the Turks & Caicos Islands two years ago.”

As to how important ACL’s operation was to the Arawak port, Mr Maura explained: “While their local sales team had been building market share they carried less than 15 per cent of the market.

“The volumes they were carrying can easily be absorbed by existing carriers serving the market.”

The shipping industry has been experiencing a major shake-out in recent years, with Pioneer Shipping closing down and Seaboard Marine reported last year to also be closing its doors - although activity has continued at its East Bay Street premises.

ACL, along with Tropical Shipping, was the last of the shipping companies to relocate to the new port. ACL was the second shipping company to announce fee increases to offset the cost of moving to the new port, with Crowley being the first. 

ACL earlier this year said that effective from March 31, 2012, the ‘Port Surcharge’ will be $200 for a 20-foot container, $350 for a 40-foot container, and $400 for 45-foot and larger containers”

Less than container load shipments also increased on March 31, within the tiered rates associated with palletised cargo shipments. The tier from 0-5 cubic feet went from $25 to $30; over 5 to 20 cubic feet went from $55 to $60; over 20 to 50 cubic feet went from $120 to $130; and over 50 to 112 cubic feet went from $140 to $160.

“These new rates reflect the change in the vessel call from Union Wharf to Arawak Cay, and the added expense of trucking the cargo to the warehouse for deconsolidation and pick up by the customer,” ACL said at the time.

It added: “Atlantic Caribbean Lines supports the redevelopment of Bay Street and looks forward with anticipation to the move from Bay Street to Arawak Cay.”

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