Hyundai Ocean Shipping Announces Major Selloff to Stay Afloat by David Z. Morris @FortuneMagazine February 4, 2016, 12:16 PM EST E-mail Tweet Facebook Linkedin Share icons The Wall Street Journal reported this week that Hyundai Merchant Marine, a major global ocean shipper, says it will sell some of its shipping facilities and its holdings in a financial unit. It’s one of the biggest signals so far of the severity of the problems facing the global shipping industry, and may be the last hope for Hyundai Merchant to avoid bankruptcy. Hyundai Merchant Marine has lost money every year since 2011. A combination of slowing global trade and a massive glut of shipping capacity have pushed cargo rates to historic, and sometimes absurd, lows. Carrier profits have been devastated worldwide, including at industry leader Maersk. Hyundai Merchant Marine is the largest component of Hyundai Group, the South Korean conglomerate that also includes tourism and construction businesses (Hyundai Motor Group and Hyundai Heavy Industries are separate entities). Its stock price has dropped more than 90% since 2010, its debts are now nearly eight times its market value, and its cash on hand is meager. Get Data Sheet, Fortune’s technology newsletter. Slowing trade, particularly between China and Europe, is the headline culprit. But another huge factor is the arrival in recent years of the next generation of supersized cargo ships. Thanks to economies of fuel and crewing, these megaships are cheaper to operate per unit of volume shipped, and all major shippers have adopted them to stay competitive. But (in a parallel of the current world oil glut) the wave of bigger ships has produced massive overcapacity, slashing profits and, ironically, leading to the mothballing of some of the very same ships. There is no solution to the capacity problem in sight, and shippers are starting to falter under the pressure. After last year’s announced merger of China’s COSCO and China Shipping Group, industry watchers began predicting a broader wave of consolidation. December saw a $2.4 billion offer for Singapore’s Neptune Orient Lines by France’s CMA CGM, with a sale likely to go through this year. For more on Korean industry, watch our video. The NOL offer was at a slight discount, and CGA CGM is now buying open-market shares for even less than its offer. That points to yet another grim aspect of the situation—shipping assets that were a major investment just a few years ago have lost significant value in the current environment, making exits from container shipping unattractive, even in the face of losses. In Hyundai Merchant Marine’s struggle for survival, the proposed sales are no silver bullet. This week’s announcement follows a previous unsuccessful attempt to sell off Hyundai Merchant’s financial holdings, and analysts speaking to the Journal said that even if successful, Hyundai Merchant’s yard sale might not save it from bankruptcy.