European shippers may also “feel the pain” of more ocean cargo carrier consolidation

ID: 

18071193
As we have noted in our news section, U.S. shippers are paying close attention to more consolidation of the global ocean cargo carriers and the impact it may have on service and rates.
European shippers may also “feel the pain” of more ocean cargo carrier consolidation-Forwardernews

It comes as small surprise that the same concerns have been raised by the European Shippers’ Council (ESC) which recently stated that the service provided by container shipping lines has deteriorated since 2016 and is now seen by exporters, importers and freight forwarders “as more problematic.” 
According to the second annual shipper satisfaction survey done by ESC and Drewry Supply Chain Advisors, all the service features received a poor or medium level of satisfaction score from customers. 
“The most critical issues facing ocean carriers for the remainder of the year are to regain profitability and stop cutting customer service as a cost-reduction measure,” said Philip Damas, Head of Drewry’s Supply Chain Advisors in an interview.
From a shipper’s viewpoint, said Damas, the risks are that some carriers could discontinue their services or slot down their services to reduce increasing fuel costs if their losses worsen.
He added that a related risk is that the rapid consolidation of the carrier industry is reducing the number of providers and could eventually push up prices.
The joint ESC and Drewry survey reveal that the 400 shippers and forwarders who took part rated the service of container shipping lines with a score of 3.2 on average on a scale of 1 (very dissatisfied) to 5 (very satisfied). 
There were different levels of satisfaction for 16 different carrier activities reviewed in the survey. Satisfaction with documentation accuracy scored 3.4, but the quality of customer service received only 2.9 and transit times and reliability of booking/cargo shipped as booked attracted scores of between 2.9 and 3 (see chart). 
Shippers and forwarders also said that carrier performance has deteriorated between 2016 and 2017 in four areas: the range of different available carriers, the range of different available services, the price of service and the overall carrier service quality. But carrier performance related to sustainability/green and carrier financial stability has improved since 2016, according to customers. 
“It is disappointing that, even after the big reorganization of container services following the start of new alliances, carriers still do not meet the expectations of their customers - on the contrary,” said Nik Delmeire, Secretary General of the ESC in a statement.
“At the time of the survey, the carriers’ Emergency Bunker Surcharge, which we regard as customer unfriendly, was not yet in place, and it is reasonable to think that the results of the survey would be worse if it was done now,” he added. 
The ESC invites carriers to meet their customers to discuss real operational issues, as already happens successfully in the European rail freight sector, instead of resorting to new cost surcharges.
And finally, to receive a higher level of customer service, some Drewry customers actively avoid direct contracts with ocean carriers and instead deal with forwarders and intermediaries. 
This appears to be a strategy U.S. shippers are embracing, too.

Author: 

Patrick Burnson

Source: 

Logistics Managment

MISSION

The Forwarder News (FN) Portal has colected news, analyze and making information from all Logistics, Supply Chain, Freight forwarding, Maritime, Rail & Train, Truck, Air and Technology news agency in ...

More

VISION

To be recognized as the world's leading and most trusted Supply Chain and Logistics portal, reaching News no matter where they are.

More

Advertisment

Nam eleifend hendrerit parturient orci lorem ipsum ipsum non eros cursus. The DrupalCon London Team had the task of narrowing 341 fantastic proposals into a schedule of 60 sessions, balanced across 5 ...

More

Contact Us

info@forwardernews.com

► Contact Form