
Maersk’s profit plummets after record year
Maersk, a giant Danish shipping company, has experienced a steep decline in its profits, with a more than 86 percent drop to 27 billion kroner compared to a historic high the previous year. The company’s revenue also fell by 37 percent to 353 billion kroner in 2023. A significant cause of the downturn was falling freight rates, which severely impacted Maersk. After years of high earnings due to supply chain bottlenecks and surging demand increasing freight rates, the shipping industry expanded their fleets. However, the market now faces overcapacity due to weakening consumer purchasing power from inflation and high interest rates, leading to decreased demand. Maersk had begun adjusting to the changing market in the fourth quarter of 2022 with early cost restrictions and fleet capacity adjustments. The company also cut its workforce from 110,000 to about 100,000 employees and cautiously reduced its 2024 investment plans.