This year promises to be one of the most challenging in recent memory for container shipping and its associated industries. The shipping industry’s growth in years past has been tied closely to the retail, housing and manufacturing sectors. As consumers shift from purchasing based on “wants and needs” to purchases driven more squarely by “needs,” we can expect lower import container volumes in North America. The significant growth in exports last year has slowed in recent months with the strengthening of the U.S. dollar and reduced demand from consumers and manufacturers overseas.
There is no question that reduced revenues associated with a slowdown in the global demand will put pressure on shippers’ and carriers’ bottom lines. Container shipping will have to play a vital role in the inevitable economic turnaround and recovery. To play that part, however, the industry and all stakeholders in container shipping must be agile and adaptable. Critical elements in any successful strategy in this environment include:
-- Carriers and customers engaging to uncover ways to improve efficiency.
-- Carriers executing standardized, reliable products and services.
-- Aligning cost and asset bases, including coordination between carriers and vendors throughout the supply chain, to drive down cost and drive out inefficiencies.
The current downturn will yield opportunities along with the challenges. Ocean carriers and their customers will have to work more closely than ever to understand the short- and long-term options, the opportunities they create and the potential implications for business
Transportation vendors, including ports, container terminals, railroads, labor and truckers, will have to do their part. Vendors must cooperate with carriers to take advantage of efficiencies and cost savings we can find in the transportation supply chain.
Transportation costs, particularly terminal and rail costs, must fall if container shipping is to contribute fully to the economic recovery.
As an industry, we must be part of the solution rather that part of the problem in these difficult economic times. We must find the opportunities in the coming year and work with our customers to take full advantage of every positive development.