Paul Devine, President, OOCL (USA)

Paul Devine, President, OOCL (USA)

Over the last few years, the scale game has taken everyone into a whole new industry landscape where big players got even bigger while the number of major carriers serving the east-west trades declined. Competition remains fierce and will likely continue to be so in 2019. For those who are unable to adjust and thrive in today’s new playing field, largely characterized by ever more competitive carriers with scale advantage and fewer alliances with greater market influence, we may see further consolidation taking place or companies struggling desperately to survive.  

In 2018, the industry continued along its path of adjustments as carriers and alliances refined their respective network and product specifications according to the changing market conditions and in response to the effects of consolidation.  2019 will be a year where carriers will focus more than ever on cost and fleet management as they grapple with challenges from the IMO 2020 low-sulfur fuel regulation for full compliance and cost recovery to ensure operational and financial stability.

On the macro level, protectionist policies have been on the rise, creating much uncertainty and disruption for businesses. Trade tensions between China and the US will prove very challenging for everyone to navigate with the possibility of shifting trade routes and services in the supply chain. Carriers will need to keep a much closer eye on any changing trade patterns resulting from a continual trade war between the two countries. This would include keeping an eye out on trends and new opportunities from bilateral trade deals inked and regional trade pacts being formed that stimulate trade growth.

In times of uncertainty and disruption, operational agility and constant communication with customers and business partners will be paramount to ensure the state of business competitiveness and ability to stay ahead of the pact.

 
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