IT’S ALL downhill from here. Israeli carrier Zim said on Wednesday that it does not see further upside from transpacific peak volumes and that it expects spot rates to remain weak for the remainder of 2025.

“We do not anticipate a strong peak season this year as supply that was previously withdrawn from the transpacific has been reinstated and demand on this trade continues to be relatively weak,” said Zim chief executive Eli Glickman on Wednesday’s conference call.

“We anticipate continued pressure on freight rates during the second half of 2025,” Glickman added, citing a “turbulent environment”.

Chief financial officer Xavier Destriau said: “The bulk of [peak season] is already behind us. That is not a good indicator to support freight rates. That is the risk we are highlighting, especially with respect to the later part of the year in Q4.”

Transpacific spot rates have continued to decline this week, according to Jefferies analyst Omar Nokta. He said on Wednesday that Asia-US west coast rates have now fallen to just $1,600-$1,700 per feu, with Asia-US east coast rates down to $2,500-$2,800 per feu.

Can carriers arrest the rate slide?

There is a theory that the carrier community is now much better at managing capacity than it was a decade ago, when carriers battled for market share and precipitated a severe and extended rate depression. That theory could be put to the test in the months ahead.

“It remains to be seen,” Destriau said in an interview with Lloyd’s List.

“The industry has demonstrated its ability to generate ongoing profits over the past few years. But the thing is, whenever we’ve ended up in a scenario where rate levels start to get dangerously close to not allowing full cost recovery, something has happened before there is drastic action taken by the industry.”

The last “something” was the Red Sea crisis, rescuing the industry in the fourth quarter of 2023.

“So, we didn’t test it then. We’ll see what happens in future quarters, but I believe that at some point, the industry will react. Rates cannot keep sliding and remain below the cost of operations for an extended period of time,” said Destriau.

The caveat is that carrier cash reserves are now vastly higher than they were during the price wars of the mid-2010s, due to retained earnings from the pandemic boom.

“The difference between now and before is that the industry can afford it because there is still strong cash on the balance sheets,” Destriau said.

Zim misses on earnings but raises guidance midpoint

Zim reported net income of $24m in 2Q25 versus $373m in 2Q24. Earnings per share of $0.19 came in well below the consensus forecast for $1.02 per share.

There were “severe market disruptions and volatility” during 2Q25, said Glickman, “mainly due to American tariff announcements”.

The carrier handled 895,000 teu in the latest quarter, down 5% sequentially versus 1Q25 and down 6% year on year.

Average freight rates (contract and spot) came in at $2,958 per feu in 2Q25, down 17% versus 1Q25 and down 12% year on year.

On a positive note, Zim increased the lower end of its full-year guidance.

It is now projecting full-year adjusted earnings before interest and taxes of $550m to $950m, versus prior guidance of $350m-$950m, increasing the midpoint by 15% to $750m.

Adjusted first-half ebit was $612m, meaning that Zim expects 2H25 adjusted ebit ranging from -$62m to $338m. At the guidance midpoint, 2H25 ebit would be $138m, down 77% versus 1H25.

Zim’s shares jumped on August 11, following a report by Israeli publication Calcalist of a take-private plan by Glickman and Israeli shipping magnate Abraham Ungar, including a potential merger with Ungar’s car carrier platform, Ray Shipping, for $2.4bn or around $20 per share.

Shares have since lost all those gains. Zim executives continue to decline to comment on the take-private report.