The total income from the shipping segment was USD 337 million and operating profit totalled USD 26 million, down 9% and 31% respectively compared with the
WWASA’s operating entities transported 15.2 million cubic metres (CBM) of cargo in the third quarter, a 9% decrease quarter on quarter. The third quarter was characterised by seasonally lower volumes and a suboptimal cargo mix. In Korea, strikes at auto manufacturers, lead to an additional drop in cargo volumes with a more substantial impact on profitability than anticipated. The negative pressure on rates continued in the third quarter.
Bunker compensation (included in the total income) was slightly positive in the third quarter. However, bunker compensation continued to stay significantly lower compared with the previous year. Net bunker cost was stable in the third quarter.
Due to drop in cargo volumes, operating companies have initiated measures to mitigate the negative impact of surplus tonnage, such as re-delivery of time charter tonnage, green recycling, charter-out, slow steaming, and early dry-docking.
In key markets, total light vehicle sales dropped by 5% from the second quarter and increased by 7% compared with the same period last year. In the US, auto sales have stabilised around 2015 levels. Inventories increased slightly in the third quarter. Light truck sales grew, while car demand remained soft.
Sales in Western Europe continued its strong development, both compared with the same period last year and the first nine months of last year. Sales in Italy and Spain have rebounded strongly, while Germany, France and UK sales recorded increases. Eastern European auto sales continued to be very weak.
Chinese car sales were stable in the third quarter. Sales in 2016 have been significantly higher than last year, mainly driven by the largecar segment. Japanese car exports continued the stable trend in the third quarter with a 4% growth quarter on quarter, and a 3% drop year over year. For the first nine months, volumes were on par with 2015 levels.
Car exports out of Korea were 21% lower quarter on quarter and 15% lower year over year, impacted by strikes in the Korean auto manufacturing industry. In the first nine months of the year, volumes were 13% below the same period in 2015, mainly due to reduced volumes to South America, Middle East and North America.
High and heavy markets
The global construction equipment market continued its overall soft development in the third quarter, mainly due to economic and political uncertainties in main markets. The outlook for 2017 is positive, with expectations of sales
growth in most main markets.
The global demand for mining equipment remained weak in the third quarter. The mining industry is characterised by excess capacity and large inventories. Analysts forecast industry consolidation and increased capital expenditures. The timing, however, is very uncertain.
Demand for agriculture equipment continued the weak trend in the third quarter compared with 2015, with sales of combines and larger equipment being especially weak. The market forecasts crop demand to be stable at the current low level for the remainder of 2016.
The logistics market