The Great Ship Jam of the Century Ushers in the "Great Reconciliation of the Century"?

Recently, a lawsuit over the largest ship jam in the Suez Canal of the century ended in an out-of-court settlement. Maersk Group has dropped its lawsuit against the owner and ship manager of the "EVERGIVEN".

In March 2021, the "EVER GIVEN" blocked the Suez Canal and hindered global trade for weeks. At that time, Maersk Group sued the shipowner, Evergreen, and the ship management company Schulte Group, claiming nearly US million.

According to the British Broadcasting Corporation, the grounding of the "EVER GIVEN" caused cargo delays worth approximately US.6 billion per day. At that time, due to high demand for goods in the United States and Europe, as well as the impact of the new coronavirus epidemic (Covid-19), there was a labor shortage in many ports, which ultimately caused supply chain bottlenecks and major challenges.

According to previous statistics from the Maersk Group, when the "EVER GIVEN" blocked the channel for several weeks during the epidemic, about 50 ships of the Maersk Group were delayed due to the incident. Therefore, the compensation requirements of the Maersk Group include additional fuel costs and the shipping company itself claims received from customers.

In this regard, both the shipowner and the ship management company denied any responsibility. Alan Beveridge, CEO of Bes Group, responded to the media and said that Maersk had no advantage in this case.

When the lawsuit was filed, container ship freight prices skyrocketed, and shipping company profits subsequently surged. For the whole of 2022, Maersk achieved extraordinary performance in line with full-year expectations: revenue increased by 32.0% to US.5 billion, interest, tax, and depreciation. Earnings before amortization (EBITDA) increased 53.2% to US.8 billion, and earnings before interest and taxes (EBIT) increased 56.9% to US.9 billion. Over the past year, however, the fortunes of large container shipping lines have taken a turn for the worse due to sluggish freight demand and a severe oversupply of ships.

It is understood that the first court hearing of the lawsuit was originally planned to be held at the end of this year or early 2024. However, Maersk Group has been working hard to reach a settlement with all parties, and finally reached an out-of-court settlement in October this year.

At present, Maersk Group confirmed that the lawsuit has been withdrawn from a commercial court in Copenhagen, Denmark, but it declined to elaborate on the reasons.