is there anything to do about ocean freight overcapacity?

WHAT TO DO ABOUT CONTAINER CAPACITY?

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@XENETA_AS

ABOUTXENETA

At Xeneta we believe there is an untapped potential for everyone in the industry, to systematically learn from our individual and collective efforts. We hold true that "if you cannot measure it, you cannot improve it". That’s why we think actionable metrics is the key to continuously evolve for every business, and ultimately the entire industry. Rethinking global logistics is the vision of Xeneta.

With international experience from the logistics industry, we have first-hand knowledge of the challenges related to high volatility and lack of transparency in the ocean freight market. By combining logistics background and information technology expertise, we found the solution to these challenges.

WE ARE TRANSFORMING GLOBAL LOGISTICS

ARE YOU PAYING THE RIGHT CONTAINER

FREIGHT RATES?

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EXCESS CAPACITY CONTINUES TO PLAGUE THE OCEAN FREIGHT MARKET RESULTING IN PLUMMETING RATES AND CULMINATING IN GLOBAL CONTAINER TRADE INCREASING LESS THAN GLOBAL ECONOMIC GROWTH IN 2015, ACCORDING TO A WELLS FARGO SECURITIES SENIOR ANALYST.

FOR YEARS THIS HAS BEEN A PROBLEM FURTHER EXACERBATED BY THE ADDITION OF MEGA-SHIPS.

WHEN MAERSK LINE PLACED ITS ORDER FOR THE FIRST TRIPLE E SHIPS WITH CAPACITIES OF 18,000 TEUS IN 2011, EVERYBODY HAD TO MAKE THE

SAME MISTAKE AND FOLLOW OR ABANDON THE TRADE.

- CEO OF POSEIDON CONTAINERS

ARE YOU PAYING THE RIGHT CONTAINER

FREIGHT RATES?

DISCOVER SAVINGS POTENTIAL IN REAL

TIME.

HOW CAN THE CONTAINER

SHIPPING INDUSTRY ELIMINATE

OVERCAPACITY?

WE ASKEDTHE TWITTERCOMMUNITY:

THE RESULTS WERE INTERESTING WITH 36% INDICATING MERGERS & ACQUISITIONS AND 36% NOTING REMOVAL OF CAPACITY WHILE 14% SAID ALLIANCE CHANGES AND 14% BELIEVED THE MARKET WILL SIMPLY SOLVE THE ISSUE.

MERGERS & ACQUISITIONS SEEM TO BE ON THE RISE WITH

HAPAG-LLOYD ACQUIRING CSAV IN 2014, CMA-CGM ANNOUNCED

ACQUISITION OF NOL IN LATE 2015 AND THE RECENT ANNOUNCEMENT

OF UASC MERGING WITH HAPAG-LLOYD.

ALLIANCES ARE CHANGING TO ADDRESS THE MARKET CHANGES. WITHIN THE PAST COUPLE OF MONTHS, THE OCEAN ALLAINCE AND THE ALLIANCE HAVE BEEN FORMED BOTH OF WHICH PLAN TO COMPETE WITH THE THIRD MAJOR ALLIANCE, 2M WHICH HAS AN APPROXIMATE 34% MARKET SHARE OF THE ASIA-EUROPE LANE.

WHEN MAERSK LINE PLACED ITS ORDER FOR THE FIRST TRIPLE E SHIPS WITH CAPACITIES OF 18,000 TEUS IN 2011, EVERYBODY HAD TO MAKE THE

SAME MISTAKE AND FOLLOW OR ABANDON THE TRADE.

- CEO OF POSEIDON CONTAINERS

ALLIANCES ARE CHANGING TO ADDRESS THE MARKET CHANGES. WITHIN THE PAST COUPLE OF MONTHS, THE OCEAN ALLAINCE AND THE ALLIANCE HAVE BEEN FORMED BOTH OF WHICH PLAN TO COMPETE WITH THE THIRD MAJOR ALLIANCE, 2M WHICH HAS AN APPROXIMATE 34% MARKET SHARE OF THE ASIA-EUROPE LANE.

M&A WILL NOT ELIMINATE OVERCAPACITY BECAUSE SHIPS CAN ALWAYS BE DEPLOYED SOMEWHERE

ELSE. INTENTIONAL CAPACITY REMOVAL IS THE ONLY ANSWER.

- PETER TIRSCHWELL OF THE JOURNAL OF COMMERCE

SOME THINK THE MARKET WILL SIMPLY SOLVE THE ISSUE.

WHAT DO YOU THINK?

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INTELLIGENCE INTO YOUR GLOBAL OCEAN FREIGHT PRICES AND CHANGE YOUR LOGISTICS

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