Alexander & Baldwin (ticker: ALEX, exchange: NASDAQ Global Select Market (.O))
News Release -
Matson's 2008 Westbound Hawaii Service Rates to Increase by $75 per Container
OAKLAND, Calif.--(BUSINESS WIRE)--Nov. 30, 2007--Matson Navigation
Company announced today that it will raise its rates for the company's
Hawaii service by $75 per westbound container and $40 per eastbound
container, effective January 6, 2008. Matson estimates that this
increase will raise rates by an average of 2.5 percent. The increase
will be filed with the Surface Transportation Board. In addition,
Matson will raise its terminal handling charge by $125 per westbound
container and $60 per eastbound container, also effective January 6,
"This rate increase will help offset rises in operating costs and
support a number of investments in our Hawaii service," said Dave
Hoppes, senior vice president, ocean services. "Given the essential
role ocean transportation has in supporting Hawaii's economy, Matson
has continued to make significant investments in upgrading its fleet.
In the past six years, Matson has awarded $584 million to U.S.
shipyards for fleet enhancements, including over $500 million for
construction of four new containerships. These investments will ensure
Hawaii will be served with modern, reliable service for decades to
come. Matson also continues to invest in new container equipment,
information technology and enhancements to its Neighbor Island fleet
and terminal facilities."
Matson's terminal handling charge was first implemented in 2003
and is designed to recover a portion of the extraordinary costs
associated with the movement of cargo through terminals. This charge
is standard in the industry and appears as a separate line item at the
bottom of the company's freight bills.
"Terminal handling costs comprise approximately 40 percent of
Matson's operating costs and today represent nearly $300 million
annually," said Hoppes. "In the past five years, terminal handling
costs, which are driven by many factors that are outside of our
control, have risen by 37 percent. Matson continues to absorb the vast
majority of these increases, but needs to pass on some of the costs to
our customers. Some of the increased costs actually went into effect
in July 2007."
In 2008, an unprecedented number of government and regulatory
issues, ranging from new trucking regulations in Southern California
to state and federal environmental and security mandated programs,
could have an additional impact on Matson's costs, some of which may
be passed on to customers. Matson will carefully monitor these various
initiatives and communicate the outcome should they be passed and
Matson is a wholly owned subsidiary of Alexander & Baldwin, Inc.
of Honolulu (NASDAQ:ALEX).
CONTACT: Matson Navigation Company
Jeff Hull, 510-628-4534
SOURCE: Matson Navigation Company