Extraordinary market conditions in sea freight are now expected to persist well into 2022, according to analysts. Meanwhile, long-haul air freight belly capacity is only expected to gradually return between 2022 and 2024. Of course, freight forwarders/shipping firms are the biggest winners in this scenario, with the same analysis produced by Jefferies further raising pre-tax profit (EBIT) estimates by 18 per cent on average in the sector for the 2021 full year and by 14 per cent in 2022.
Back in April, Tyres & Accessories spoke to leading supplier of freight forwarding services to the UK tyre sector, Maritime Cargo Services about the perfect storm of circumstances complicating life for tyre importers. Then it was difficult to anticipate the logistical problems the industry would face by the end of the first quarter – at least far enough ahead to sidestep the issues entirely. Even armed with the expectation of disruption, the pressure has built at British ports throughout the year, especially in the last quarter as Covid began to spike again. As a result, Honda UK’s suspension of production became a high-profile symptom of the catalogue of issues causing bottlenecking and ultimately delays in the supply chain. With the end of the Brexit transition coming amidst the second spike of Covid-19 transmissions on 31 December, T&A asked MCS again about what difficulties distribution businesses need to plan for this winter.
Chinese celebrations of Lunar New Year (25 January) were muted this year by the emerging coronavirus crisis, with the huge amount of personal travel associated with the holiday period down around 45 per cent. Yet global business’s reliance on China’s manufacturing meant that large orders were, as usual, preplanned to take into account the two to three weeks of manufacturing slowdown at this time of year. In the UK tyre sector, the result is that a large number of tyres that will likely exceed some distributors’ warehousing capacity are now arriving at UK ports. Freight forwarder, Maritime Cargo Services is offering one solution to companies experiencing this problem.
Shipping plays a vital part in the world of tyre wholesaling. Managing the volatility of freight rates with efficient and transparent service is paramount in maintaining the competitiveness of distribution operations. Maritime Cargo Services, a freight forwarder with significant ties to the UK tyre industry, tells Tyres & Accessoires about the factors affecting the global shipping industry, and how its fluctuations, illustrated by this chart, which shows at a glance the trends of the last 12 months, must be managed effectively to allow tyre wholesalers to operate efficiently.
As August came to its close, the world’s seventh largest – and South Korea’s biggest – container shipping line, Hanjin Shipping, filed for court receivership, consumed by mounting debt schedules with creditors and increasing industry overcapacity. Hanjin had suffered annual net losses from 2011-2014 – with total debt in June reaching a staggering $5.5billion. While there may be hope on the horizon, (Hyundai Merchant Marine are in talks to acquire Hanjin’s vessels and staff), for the time being, ports in China and the US have denied entry to Hanjin ships and goods cannot be unloaded. Discussions between banks and Hanjin are yet to proffer a solution, though it seems likely that its Asia-United States route and related sales and marketing assets could be on sale by the end of the week in order to raise rehabilitation funds, several news sources have reported.
Freight forwarder Rhenus Logistics has helped the organiser of the Hong Kong-Beijing Rally celebrate the event’s 30th anniversary in style, having air freighted two 1985 Audi 80 Quattro four wheel drive cars from Bebington, UK to the rally’s start line in Hong Kong, China.
Leading freight forwarder, Rhenus Logistics, has welcomed experienced logistics professional Tim Doggett as its new general manager, north west. The role will see Doggett take responsibility for the organisation’s sales and operations at its Trafford Park branch in Manchester and Liverpool branch in Frodsham, Cheshire.