'Challenging times ahead': Maersk CEO to cut thousands more jobs

This will reduce the global workforce to below 100,000 positions. Accordingly, the total restructuring charge is now expected at US$350M, up from US$150M announced in February.

This comes on the back of job reductions taking staff numbers from 110,000 in early 2023 to around 103,500 today, to cushion the impact of the challenging market conditions.

Commenting on its latest measures, Maersk said, “The adjustment of the workforce complements the decisive actions taken on cost containment throughout the year. The accumulated effect will bring down Maersk’s selling, general and administrative expenses costs by US$600M for 2024. In addition, capex spend has been adjusted downward for 2023 and 2024 and further measures are under review.”

Maersk’s ocean sector reported a 9% increase in volumes since the previous quarter and a strong cost focus supported an 11% decrease in unit cost at fixed bunker compared with Q3 2022. However, EBIT was negative at US$27M, down from US$8.7Bn in Q3 2022, driven by “significant pressure on rates, in particular on Asia to Europe, North America and Latin America trades”.

Maersk chief executive Vincent Clerc said in a statement, “Our industry is facing a new normal with subdued demand, prices back in line with historical levels and inflationary pressure on our cost base. Since the summer, we have seen overcapacity across most regions triggering price drops and no noticeable uptick in ship recycling or idling. Given the challenging times ahead, we accelerated several cost and cash containment measures to safeguard our financial performance. While continuously streamlining our organisation and operations, we remain dedicated to our strategy of fulfilling our customers’ diversified supply chain needs while pursuing growth opportunities across our Terminals business and Logistic & Services.”