New Maersk chief makes shipping line 'top priority'
Friday, 16 November 2007
Robert Wright
FT Syndication Service
LONDON: Improving returns in its struggling container shipping business is the number one priority for AP Moller-Maersk, the Danish group's first externally appointed chief executive has said on his first day in the job.
Nils Smedegaard Andersen, who came to Maersk from Carlsberg, the brewer, said a team was developing plans to increase returns at the Maersk Line container shipping business, which has been losing market share in spite of being the world's largest container line and has had to slash its rates. Mr Andersen was speaking only hours after taking office early this month. However, he admitted Maersk Line faced complex problems.
"Usually when you have a problem that cannot be fixed in a few months, it's because it's a composite problem," he said. "What we have to do is really focus on holistic solutions."
Mr Andersen comes to Maersk after a management shake-up in June saw two senior executives -- Tommy Thomsen and Knud Stubkjaer -- pushed out and Jess Soderberg, chief executive, advance his retirement by two years. The changes were seen as a response by Michael Prem Rasmussen, chairman, to the problems facing Maersk Line since it botched the integration of computer systems with P&O Nedlloyd, the former world number three container line, which it took over in 2005.
Mr Andersen is only the fourth chief executive in Maersk's 103-year history. Before Mr Soderberg, Arnold Peter Moller ran the company from 1904 until 1965 and Maersk McKinney-Moller, his son, ran the company until Mr Soderberg's appointment in 1993. Mr McKinney-Moller, 94, still has a major influence over the company.
The container shipping business is not growing fast enough and not making enough money, according to Mr Andersen.
"I think improving returns at this point is the first priority" followed by, mid-term, creating more growth in the business, he said.
The container division would have to concentrate on finding the right routes to operate and the right pricing mechanisms, he added.
"We just have to get better and better all the time," he said.
"There's no way you can take a quick decision and everything is good. This is about improving the way we work day-to-day."
Losses at the container division depressed last year's earnings at the group, which produced pre-tax profits for 2006 of $6.05bn on $44.5bn revenue.
FT Syndication Service
LONDON: Improving returns in its struggling container shipping business is the number one priority for AP Moller-Maersk, the Danish group's first externally appointed chief executive has said on his first day in the job.
Nils Smedegaard Andersen, who came to Maersk from Carlsberg, the brewer, said a team was developing plans to increase returns at the Maersk Line container shipping business, which has been losing market share in spite of being the world's largest container line and has had to slash its rates. Mr Andersen was speaking only hours after taking office early this month. However, he admitted Maersk Line faced complex problems.
"Usually when you have a problem that cannot be fixed in a few months, it's because it's a composite problem," he said. "What we have to do is really focus on holistic solutions."
Mr Andersen comes to Maersk after a management shake-up in June saw two senior executives -- Tommy Thomsen and Knud Stubkjaer -- pushed out and Jess Soderberg, chief executive, advance his retirement by two years. The changes were seen as a response by Michael Prem Rasmussen, chairman, to the problems facing Maersk Line since it botched the integration of computer systems with P&O Nedlloyd, the former world number three container line, which it took over in 2005.
Mr Andersen is only the fourth chief executive in Maersk's 103-year history. Before Mr Soderberg, Arnold Peter Moller ran the company from 1904 until 1965 and Maersk McKinney-Moller, his son, ran the company until Mr Soderberg's appointment in 1993. Mr McKinney-Moller, 94, still has a major influence over the company.
The container shipping business is not growing fast enough and not making enough money, according to Mr Andersen.
"I think improving returns at this point is the first priority" followed by, mid-term, creating more growth in the business, he said.
The container division would have to concentrate on finding the right routes to operate and the right pricing mechanisms, he added.
"We just have to get better and better all the time," he said.
"There's no way you can take a quick decision and everything is good. This is about improving the way we work day-to-day."
Losses at the container division depressed last year's earnings at the group, which produced pre-tax profits for 2006 of $6.05bn on $44.5bn revenue.