American fines on Chinese freight ships threaten business

Niche Ocean Carrier Atlantic Container Line warns the fines that the US government plans to hit the Chinese construction cargo ships which would force it to leave the United States and to release the unbalanced global supply chain, potentially feeding freight rates that are not seen from COVVID.

“This strikes the American exporters and importers worse than anyone,” said Andrew Abbott, CEO of ACL. “If this happens, we are bankrupt and we will have to close.”

The US trade representative held his second day of this week's hearings on the fines that would be deducted under article 301 of US commercial law on Wednesday, with more than 300 commercial groups and other interested parties warning the government through the letters of comments and testify to this that the United States is not a position of economic war which places ocean carriers using Chinese manufacturing ships in the middle. Soon, Chinese manufacturing ships will represent 98% of commercial ships on the world's oceans.

The political proposal, began under the Biden administration and culminating in a January report concluding that the Chinese industry of naval manufacturers has had an unjust advantage, would allow the United States government to impose steep levies of the deductible for uprods in American ports. For operators belonging to Chinese (like COSCO), service fees of up to $ 1 million could be billed on each ship. For non -Chinese ocean carriers with fleets containing ships designed in China, service fees would represent up to $ 1.5 million for each American call port.

In the commentary submitted from ACL to the USTR, Abbott exposed the economic difficulties that his business would face, saying that if the United States government was pursuing fines, this would make us completely non -competitive against other transporters of the American professions “.

ACL, which is the oldest line of containers in continuous activity in the world and belongs to the Grimaldi group in Italy, is the only operator of combined-containers-Roll-sur-Roll between North America and North Europe.

If the ACL had abandoned the American market, national manufacturers would lose their only transporter from the North-Adopté Atlantic and the transporter of the North Primary Atlantic of the oversized cargo and the project in Europe. ACL manages vehicles, construction equipment, planes including Airbus wings and project freight, including more than half of American construction equipment, agricultural equipment and oversized machines moving from New York, Baltimore and Norfolk ports to Europe.

“All Airbus wings are made here in the United States and we transport them in the United Kingdom,” Abbott told CNBC. “If we disappear, we should find another brake loose boat.”

Abbott clearly told the CNBC that the situation of his business was unique and that the largest ocean carriers will be able to better alleviate the impact of potential fines. “I will end up hitting a customer with fees of $ 2,000 to $ 2,500, where the big guys could only have $ 800, so in today's world, it's a huge amount of money, and could potentially put us out of business. We would therefore have to stick them in Asia, that's what we do.”

The objective of political proposals is to relaunch the American inner shipbuilding industry, but many commentators have argued that these fines are the wrong way to pursue this objective. Abbott said that this is why he made public the situation of his business. “The Chinese operators against whom they are trying to go because of how they operate their ships, and the number of ports they call will probably be among the least affected by this new configuration. The guys you want to target will be without Scottish, and the guys who were in your own country are nailed,” said Abbott.

The closure of the American OCL offices would have an impact on 300 employees in addition to the supply chain pipeline that supports them, such as truck drivers and warehouse workers.

President Trump declared in his recent speech to the congress that his administration would create a special office dedicated to shipbuilding and will offer tax incentives to national manufacturing.

Abbott says that the current reality in the American naval construction industry is one of the forces that leave the LCA dependent on China. “The only reason I use the Chinese is because when we went to American Yards, they told me that they could not build a ship for seven years. … The shipyards we were talking about were reserved with soldiers. They had no space to build a commercial ship. If you get $ 2.5 billion for a destructive course, why you wouldn't have sense.

The threat of closing in the United States following fees comes at a time when the commercial route was on a takeover due to the changes in the commercial policy, said Abbott.

After a 2024 which, according to Abbott, was its smallest year in volume since 1967, since January, US ACL exports have increased by 50%. “It is all forward. It is all the fear of not being able to get your things and that the reprisal rates set up,” he said. “”

The main ocean carriers plan to bypass the fines if the American government promulgates them, with significant consequences for certain American ports.

Soren Toft, CEO of the largest ocean carrier in the world, MSC, told CNBC at the recent TPM conference in Long Beach, California, that at least a port, the port of Oakland, could be eliminated, with diverted containers to alternative ports such as Los Angeles and Long Beach.

The re-reachment of imports or exports linked to the United States of ACL to Canadian or Mexican ports has no economic sense, said Abbott, as “domestic transport costs are prohibitive”.

He also warned that port cancellations would create congestion in ports where the containers are reoriented, which creates an artificial crunch in the availability of containers and, therefore, feeds freight rates.

“There will be rate increases in the era of the cocovated era,” warned Abbott. “All that will do is put many American exporters in bankruptcy. They will not be able to compete with the rest of the world.” Watch the full video interview with Abbott below.

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