There is a shortage of parts everywhere – and those who transport them earn more than ever. This also has to do with the fact that cartels dominate the market with impunity. In this environment, Germany’s largest shipping company earns more than any other company in this country without paying any significant taxes. Ironically, Germany’s most pugnacious billionaire benefits from this.
If nothing else goes wrong, Hapag-Lloyd will earn around 18 billion euros this year, replacing companies like VW as the most profitable group in Germany. Germany’s largest shipping company is therefore also in the discussion for an excess profit tax, after all it is benefiting from the crisis around us like no other company. In the US, shipping companies came under so much political pressure that President Joe Biden signed the Ocean Shipping Reform Act in June. The ordinance noticeably restricts the freedom of action of the corporations. In France, a tax on crisis profits for transport companies initially only failed because the companies were subject to strict requirements.
In Germany, on the other hand, Hapag-Lloyd has not yet been in the spotlight. In 2021, the shipping company paid just 61 million taxes to the tax office on its record profit of 9.4 billion euros – a rate of 0.67 percent. This year, despite the record profits, it’s only been 77 million euros so far. Due to the so-called tonnage tax, it is not the profit that is taxed, but only the size of the ships, which helps the shipping companies to make enormous savings in boom phases.
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Hapag-Lloyd does not play a special role in the world as it is currently ticking: Almost all major shipping companies are benefiting from the bottlenecks in the logistics market – competitor Maersk also recently published record figures. The reason: there is too much cargo for too few ships. If you look closely at the market, you can see three large cartels that, with the approval of the politicians, are dividing the cake among themselves. And where there is little competition, prices rise – which consumers ultimately have to pay for.
If you are wondering why the inflation rate is rising so much, you have to look at the oceans. The three big ships CMA, CGM and Evergreen gave themselves the maritime name “Ocean Alliance”. The two market leaders MSC and Maersk called themselves “2M” for short and the third in the group, Hapag-Lloyd belongs to “The Alliance”. According to market researcher Alphaliner, these three alliances account for 83 percent of the world market.
Criticism has been around for a long time and is getting louder in view of the current balance sheet figures of the shipping companies. Last but not least, the Central Association of Seaport Operators calls on the EU to put an end to this superior power of shipowner alliances. Specifically, it should be forbidden for shipowners to join forces to use combined market power to lower prices for port services and hinterland traffic. This is allowed by the so-called block exemption regulation of the EU, which expires in 2024 and is now viewed all the more critically.
Hapag-Lloyd CEO Rolf Habben Jansen defended the mergers, as did his counterparts. “Without the division of labor within the alliances, the delivery bottlenecks during the pandemic would have been much worse.” In addition, there are some indications that the record figures are unique for Hapag-Lloyd: The bottlenecks on the oceans have recently eased again, as have the prices for freight sink. Conversely, fuel costs increase.
At Hapag-Lloyd, the high profits are of particular importance because the most important owner is Klaus-Michael Kühne. The 85-year-old billionaire is currently causing turbulence at Lufthansa because he insists on a seat on the supervisory board, but does not say what he intends to do with his 17.5 percent shareholding. There is a lack of clarity at Lufthansa, and many even consider a complete takeover of the airline by Kühne to be possible. Hapag-Lloyd’s profits could be useful in this regard, although there are currently no concrete signs of this.
It is possible that Kühne will also support his heart club again with an injection of millions. In mid-October he indicated that he would support Hamburger SV with 120 million euros under certain conditions. The club, which is currently in the process of being promoted to the 1st Bundesliga, would apparently prefer sponsorship of the stadium to Kühne demanding more power in the executive committee. Similar to Lufthansa, HSV is also waiting for clear signals from the most successful Hamburg businessman of all time.