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Supply Chain Graphic of the Week: When Ocean Carriers become Logistics Integrators

If Successful, Maersk, Others, will Change Global Logistics Landscape

 

Jan. 10, 2019

 

 

Lots of changes afoot in the ocean container shipping sector, as carriers struggle with years of low profits or wrose in the face of continued overcapacity - and a lack of differentiation in just moving boxes.

 

Carriers are embracing different strategies to change their fortunes. Some - notably Maersk Line and CMA CGM - plan to become end-end-end logistics service providers.

 

If they are successful, it will bring dramatic changes to who does what in global logistics, as illustrated in the chart below from Drewry Shipping:

 


In fact, Soren Skou, Maersk CEO, reently said that "We are building a company that is a global integrator of container logistics – a company very similar to UPS and FedEx; and I hope they will be considered peers of ours when we are done with this transformation journey in three to five years; a network-based, asset-based global logistics company."

 

Wow.

 

Ultimately, says Drewry, "The aim is to get closer to the cargo owners as the single provider for all their transportation needs. It's not clear how appealing this will be and if shippers will balk at the potentially restricted choice and dominance afforded to the new supply chain kings."

 

Conversely, other container carriers, notably Hapag-Lloyd, are rejecting this strategy with plans to focus on being superior container carriers, not broader logistics providers.

 

 

Any Feedback on our Supply Chain Graphic of the Week? Let us know your thoughts at the Feedback section below.

 

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