Of the major east-west container lines, none has a larger share of its fleet — 44 percent — deployed in the trans-Pacific trade than APL, according to Alphaliner data. At the same time, no major trade lane has a greater concentration of cargo controlled by beneficial cargo owners and annual service contracts than the trans-Pacific.
It’s no coincidence, then, that APL is a shipper-focused carrier, more intent than most carriers on delivering the elevated service levels retailers and manufacturers demand, and expecting to obtain above-market rates as a result. In an industry where gyrating rates put even the most committed shipper-carrier relationships to the test, this is no easy space to occupy.
APL has clung tightly to its three West Coast terminals, believing them to be critical to service delivery, as other lines have sold their terminal operations or restructured to put them under separate organizations. The subsidiary of Singapore-based Neptune Orient Lines is known for technology and its intermodal network because it has invested in those operations, seeing them as differentiators in a shipper-dominated market.
Yet perhaps the most visible indicator of APL’s orientation is how Ron Widdows, CEO of NOL since 2008 (and head of APL for five years prior) has defined his role in a way that is unique in international shipping.
Widdows, who will step down at the end of this year, understood that serving the BCO market effectively means an ability to deliver on service and, just as importantly, maintaining close, often personal customer relationships to be able to communicate the value of service during those not-so-infrequent times when rates are tanking and customers lose sight of the value of service.
Accomplishing the former means running a shipping line well, focused on the complexity of end-to-end supply chains versus simpler port-to-port operations. Accomplishing the latter is trickier, obviously starting with being visible with customers, whether hosting frequent customer events or having lots of one-on-one face time with key accounts — the kind of activity everyone in the transportation world is familiar with.
But Widdows believed the role demanded something beyond chief salesman for APL. He was intent on finding common cause with customers on larger industry issues, and showing the world how the international shipping business serves interests of the general economy and world trade. One of those major issues was infrastructure.
As Jeff Shane, former U.S. Transportation Department undersecretary for policy and now an attorney with Hogan Lovells, recalled, “Ron came in with a number of his biggest customers (Federated Department Stores, Nike, Dell, 3M, Pier 1, among others). They were all concerned,” he said, “about a steady deterioration in the international supply chain. He delivered a presentation that stopped us in our tracks.
“Ron quantified every aspect of transportation between Asia and the U.S.,” Shane said. “He contrasted (a) the growth in box movements across the Pacific, surging eastbound and westbound demand, new, larger container ship capacity coming on line, etc., with (b) all the impediments to accommodating that growth.
“He showed us ship berthing times and container lifts per hour at U.S. ports, labor shortages, the velocity of the U.S. freight rail system, problems in the trucking industry — all graphed over time. He documented delays, diversions, and missed voyages attributable to U.S. port congestion,” Shane said. “It was all stunning.”
Shane continued, “I felt it was so powerful — with fundamental implications for the country’s economic health — that I asked the White House to convene a special meeting of its senior economic advisers; I wanted them to see the presentation for themselves. They agreed, and Ron returned from Singapore to do a repeat performance. Immediately following that meeting, I received a call from Vice President Cheney’s office. Would Mr. Widdows agree to come by and do the briefing again for the VP’s economic policy staff? He did, with telling effect.”
That impact was to elevate goods movement to an issue of national concern, something no other industry leader has done more effectively. The issue remains high on Washington’s radar screen today, and Widdows’ actions carry an important lesson for transportation and trade advocates who cast their arguments in narrow, plainly self-interested terms.
And in the process of that exercise as well as a career spent building bridges with customers, Widdows has won the acclaim of customers.
“I’ve been fortunate to have had the opportunity to work with Ron on public policy issues, including the time we presented to the U.S. Department of Transportation and the White House regarding the need to improve the transportation infrastructure,” said Michael Jacobs, senior vice president for logistics at Toys ‘R’ Us. “Although the word ‘partner’ is often overused, it is most appropriate when it comes to Ron. He truly understands how to build collaborative relationships.”
“Ron has been wonderful partner with our organization, providing exceptional support over the years,” said Rick Gabrielson, director of international transportation for Target Stores. “He has provided a leadership voice to the industry for many years, helping to bring carriers and shippers together in addressing a wide array of challenges.”
According to the succession announcement from NOL, Widdows will remain an adviser to the company after retiring as chairman. There are many who hope he’ll remain as an adviser for the shipping industry as a whole.