The car carrier market is stabilizing, following nearly three years of exceptionally high freight rates.
According to an analysis by Veson Nautical, freight rates and asset values continued their path toward normalization in the first half of 2025.
Although the market has not yet fully returned to historical average levels, the overall trend suggests that a “soft landing” is underway, supported by a combination of declining demand, increasing capacity supply, and adverse macroeconomic conditions.
According to forecasts, a full recovery of Red Sea trade is unlikely before 2027.
This delay, combined with the restraint in new orders and the cautious activity in the S&P (Sale & Purchase), reinforces the view that the market is in a phase of gradual rebalancing, towards a more sustainable and long-term balanced model.
Time charter rates for standard Pure Car Truck Carriers (6,500 CEUs) corrected sharply in the first half of 2025, due to the massive delivery of newbuildings and the weakening market related to the imposition of tariffs by the US Trade Representative and sluggish exports from Asia.
In Large Car Truck Carriers (LCTCs) (7,500 – 9,000 CEUs), total global capacity increased by 5%, mainly in China, while the growth of vehicle exports from Asia was limited to 4%.
As Veson reported, this disproportion contributed to the 44% decline in VesselsValue’s one-year time charter index for 6,500 CEU vessels by June, effectively ending the period of historically high rates that had begun since the pandemic.
Despite the generally subdued short-term outlook, there are still signs of resilience in the market.
For example, there are three-year time charter agreements, such as CMA CGM’s January deal for Lake Fuxian (6,300 CEUs, built November 2009, Shin Kurushima Onishi, Japan) at a daily rate of $38,000, and Hede International Shipping’s June deal for Paganella (5,000 CEUs, built October 2009, Yangfan Zhoushan, China) at $27,000 per day.
These exceptions highlight that shipowners with well-positioned tonnage can still secure high returns.
