SHIPPING giant P&O is to make sweeping cost cuts across its joint venture, P&O Nedlloyd, one of Southampton's major port customers, after the division sank into the red last quarter.

The group is hoping to save at least £62.5 million over the next 12 months in P&O Nedlloyd, its operation with Nedlloyd of the Netherlands.

The plans will see job cuts in the United Kingdom, the Netherlands and the rest of the world, but P&O would not disclose the number of staff that would be affected.

P&O Nedlloyd's vessels regularly call at Southampton's busy container terminal and are some of the biggest ships of their kind in service today.

Among the company's fleet is P&O Nedlloyd Southampton, one of the new generation of ships which can carry up to 6,500 container units.

The Nedlloyd arm, which carries cargo ranging from clothing and machinery parts to whisky and waste paper, had been hit by a glut of ships on the market.

The group said the overall outlook was "neutral to mildly positive".

P&O Nedlloyd reported pre-tax losses for the second quarter of £20 million against a profit of £5.6 million for the same period last year.

This follows P&O's announcement back in March that it would raise more than £2 billion selling off its non-maritime assets to concentrate on cruises, ferries, ports and logistics.

During the first half of this year, P&O has also made around £140 million of property disposals.

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