Hawaiʻi's largest shipping company is navigating choppy waters as the U.S. trade war with China impacts its business. But Matson already has plans for a new service to Asia.
Matson reported a strong 2024 that was driven largely by rising freight rates in its service between California and China. But this year has brought new challenges.
Tariffs on certain Chinese goods have soared as high as 145%. Two months ago, Matson told analysts that it was already hurting their profits.
Executives also warned of unpredictability in transpacific shipping, as cargo vessels skipped scheduled ports and shifted services in response to demand drops caused by tariffs.
The company says container volume in its China service has declined by about 30% since the tariffs took effect in April.
Matson now expects lower container volume and freight rates through the remainder of the year compared to 2024. But the company already has a plan to diversify.
It announced a new direct service connecting Ho Chi Minh City in Vietnam to its sailings from Shanghai.
The company told shareholders to expect higher short-term volume out of Vietnam. It says its long-term relationships in Asia support diversification across multiple freight origins.
Local economist Paul Brewbaker says Matson and other ocean carriers will continue to feel the effects of the tariffs this year. That's because their ships are on a schedule, whether they're full or not.
