Clipper Bulk cuts costs to combat coronavirus

Clipper Bulk cuts costs to combat coronavirus

Danish bulk carrier operator Clipper Bulk has announced initiatives to reduce costs as part of its measures to deal with the coronavirus pandemic.

The initiatives include downsizing which will see the company cut 24 out of 91 jobs ashore by end of April. The changes will predominately be implemented at the company’s head office in Copenhagen.

“The dry cargo market has struggled with unsustainably low freight rates for years, but the Covid-19 pandemic has made matters worse and caused a steep downturn in demand and freight rates. We need to adapt to this new reality, and we are making these changes to stay ahead of the situation. While we deeply regret the implications for staff, the downsizing is essential to adjust costs to prevailing markets,” said Clipper Group CEO Peter Norborg.

The company will also focus primarily on its profitable niche operations including Clipper Steel, Compass Rose, China Parcel as well as Brazil Steel and it expects income from these niche operations to fully cover Clipper Bulk’s cost base after downsizing.

Additionally, the company will continue to approach the spot market cautiously to serve long-standing customers and partners.

“Rather than hoping that markets will normalize in 3-6 months, we are taking the steps required to run a viable operation in today’s depressed markets,” Norborg added.

According to Clipper Bulk, the company’s integration of the newly acquired Bulkhandling Pool continues unaffected by the organisational changes and it looks forward to announce new pool members soon.

Clipper Bulk operates 65-85 vessels, including tonnage operated by the two Clipper Bulk, in managed pools – the Clipper Handy Pool and the Clipper Bulkhandling Pool.

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