In 2007, the Panama Canal Authority embarked on a nearly decade-long 5 billion USD expansion of the Panama Canal. The competitive advantage of the existing canal infrastructure that was built a century ago began to diminish as shipping companies invested in larger vessels in their drive for economies of scale. The massive infrastructure project focused on re-engineering the strategic waterway, including installation of a parallel series of longer and wider locks to re-establish the advantages the canal brings to global commerce.
As the project matured, shipping companies including WWL aligned with Panama’s ambitious undertaking and began rethinking vessel deployment patterns and network design. In WWL’s case, the expanded canal dimensions link directly to the wider-beamed best-in-class HERO vessel design, leveraging the increased width provided by the new set of locks. The wider beam loosened design constraints, allowing HERO to develop into a peerless operational and environmental vessel. With both canal and vessel construction designs secure and following parallel paths, timing became the next critical success factor.
Unfortunately, construction delays postponed the opening of the expanded canal, resulting in “new Panamax” vessel construction front-running the expanded canal capabilities. For WWL, the mismatch between canal expansion and HERO deployment constrained the operating range of the HERO vessels and challenged network optimization efforts for a period of time. In other words, WWL could not deploy HERO in round-the-world trading until the locks were completed. The late June completion of the canal expansion and Thalatta’s transit via the new canal locks on 28 July represented the removal of the restrictions and allowed full deployment of the HERO vessels in any trade pattern. Going forward, the expanded canal will lift the value of the ocean product by simplifying deployment decisions and expanding the ocean product options to our customers.
Watch the movie of MVThalatta transiting the new canal.