Cargo airlines losing out to ocean container carriers
More companies are shipping their products by sea instead of by air in a shift that is seen as a permanent trend by industry executives
Airlines have permanently lost out to ocean container lines as box carriers grab an increasing share of the freight that was previously moved by air, according to logistics and cargo executives.
Alfred Hofmann, the senior vice-president for sea freight in the Asia-Pacific at logistics giant Kuehne+Nagel, said the structural shift was permanent. "It's a trend that can't stop," he said.
Hofmann's views were supported by Charles Wellins, a senior vice-president of supply chain solutions at Ceva Logistics, who said there was a growing shift to ocean freight by cargo owners who had a historic reliance on airfreight.
Nick Rhodes, the director of Cathay Pacific Cargo, tended to agree with the prognosis. "Those guys are the experts as they see both sides of the logistics business," he said. "I suspect they are right and that much of the shift to sea is permanent. Only time will tell. Our loads are definitely down but it is hard to say how much is due to less production, more competition or modal shift. A bit of each, I suspect."
Hofmann said the pharmaceutical industry and manufacturers of temperature-controlled products were at the "forefront of change" from airfreight to sea freight. He pointed out that high-technology electronic manufacturers aimed "to convert over 50 per cent of notebook shipments to ocean".