Europe Braces for Shipping Crunch as China Makes Historic Fleet Play

European maritime operators find themselves navigating treacherous waters as the sector confronts a volatile cocktail of regulatory pressure, geopolitical disruption and unprecedented Asian expansion that threatens to reshape the competitive landscape.

China's state-owned COSCO has thrown down the gauntlet with an $7.1 billion order for 87 vessels—the largest domestic shipbuilding contract in Chinese history. The December deal with China State Shipbuilding Corporation spans ultra-large containerships to specialised carriers, underscoring Beijing's determination to cement its dominance in global shipping whilst European lines grapple with mounting compliance costs.

The timing could hardly be more awkward for Brussels. From January, the EU's FuelEU Maritime regulation demands ships calling at European ports meet progressively stricter greenhouse gas intensity limits, beginning with a 2 per cent reduction. Combined with the EU Emissions Trading System—which now requires carriers to surrender allowances for 70 per cent of 2025 emissions, up from 40 per cent—the regulatory burden threatens to substantially inflate operating costs for lines serving the continent.

European ports remain under strain. Rotterdam and Antwerp experienced severe congestion through summer and autumn, with dwell times stretching beyond eight days at peak periods. Though conditions have eased, infrastructure bottlenecks persist whilst the industry simultaneously confronts new customs filing requirements under the Import Control System 2.

Meanwhile, Singapore and South Korea's November agreement to establish a green and digital shipping corridor signals Asia's determination to capture first-mover advantage in zero-emission fuels and maritime digitisation. The partnership, witnessed by both nations' heads of government, commits to developing bunkering infrastructure and aligning technical standards—precisely the coordinated approach European ports have struggled to achieve.

For EU operators, the message is stark: comply with increasingly stringent environmental mandates whilst competing against rivals backed by coordinated industrial policy and massive state investment in next-generation tonnage.