Friday, February 2, 2018

A Glimpse at Current Multimodal Shipping, Freight Forwarding and Logistics Around the Globe

A Quick Look at the Rest of What is Happening in the Industry This Week
Shipping News Feature
US – We begin this week's look at some of the general trade news with an upcoming event of particular interest to investors in the sector. As well as owning or leasing 122 freight railroads across North America, Genesee & Wyoming has extended its reach in the past few years to acquire a range of logistics interests, not least the purchase of the Freightliner group, the UK's largest rail maritime intermodal operator and second-largest rail freight company in 2015, and container specialists Pentalver last year.

Now everybody can take the chance to listen to G&W Chief Executive Officer Jack Hellmann give a live presentation at the Stifel Transportation & Logistics Conference in Miami Beach, Florida, on Wednesday, February 14 at 7:35 am Eastern Standard Time. The internet broadcast can be accessed here and the webcast will also be archived on the site.

 IRELAND – SPAIN – The Irish Continental Group (ICG) which owns Irish Ferries has agreed the sale of its High Speed Craft Jonathan Swift to Balearia Eurolineas Maritimas S.A., a Spanish RoRo ferry group with 18 port offices around Spain and its offshore islands. The agreed consideration of €15.5 million less brokers commission is payable in cash on delivery less a 10% deposit to be held in escrow. The vessel is to be delivered by the end of April 2018. Proceeds of the sale will be used for general corporate purposes.

 The Jonathan Swift was commissioned by and delivered to ICG in 1999 and has since operated on the company's Dublin - Holyhead route. This vessel will be replaced in the Irish Ferries fleet by the 2001 built High Speed Craft Westpac Express, which was recently redelivered following a period of twenty months on external charter. She is currently undergoing a refurbishment programme to bring her up to Irish Ferries passenger service standards.

FRANCE – DENMARK – Bolloré Logistics has extended its influence in Scandinavia with the acquisition of a majority stake in the Danish freight forwarder Global Solutions A/S. This purchase is part of Bolloré Logistics' strategic development through external growth and the group now has 165 sites in 22 European countries with a combined headcount of 5,500, meaning it is in the largest 5 such freight operations in the continent.

Already established in Norway, Bolloré now benefits from Denmark's Global Solutions network, which has been operating on the Danish market for 11 years, with expertise in the airfreight, sea freight and express business lines, particularly on the Europe-Asia axis. Global Solutions, now Bolloré Logistics brand, has two offices: an office at Copenhagen airport, and its headquarters in Vejle, the country's logistics hub. Henri Le Gouis, CEO Europe of Bolloré Logistics, commented:

”This new location will enable us to better serve our key account customers in Denmark and more generally in Scandinavia. We will support Danish companies in their international development and logistics projects, particularly in Africa, the continent of the future with strong market opportunities, where we operate as the 1st integrated logistics network.”

UK – Walker Logistics, which provides a variety of ambient temperature storage and supply chain fulfilment services across the South of England, reports the last quarter of 2017 saw the number of orders picked and dispatched from their multi-user facilities in Berkshire increase by an average of 73% year on year.

Monthly order throughput was up by 56% in October, 95% in November and 63% in December, as against 2016, and, despite the escalation in activity, picking accuracy and turnaround times for orders remained at a record high level. Before saying there has been no signs of a significant slowdown in the New Year so far, William Walker, sales director explained the jump, saying:

“The upturn not only reflects an increase in our client base but also the fact that our existing client companies are enjoying notable growth in demand for their products. Obviously, with Black Friday, Cyber Monday and, of course, Christmas all falling in the fourth quarter, we anticipated the busy period and employed additional staff across the business to ensure that the high level of service that our clients have come to expect was not affected by the significant volume growth.”

US – FINLAND – The technology group Wärtsilä is expanding the service offering of its QuantiServ business line with the acquisition of the California based American engineering company Lock-n-Stitch. Wärtsilä says the acquisition strengthens Wärtsilä’s service portfolio for customers operating multiple brands. The QuantiServ business line within Wärtsilä Services was established in 2016 to provide support and maintenance services for customers operating equipment by multiple brands – including Wärtsilä acquired service brands (e.g. Deutz, Sulzer, Stork, Nohab, Crepelle) and/or other manufacturers’ brands – both in the marine and energy sectors. The services offered are reconditioning services, in-situ services as well as flexible repair and overhaul services for auxiliary and generating sets.

Lock-n-Stitch specialises in cast iron repairs, and its expertise will complement the service offering of the QuantiServ business line with its experience in the application of 3D technology for repair services. This recent development includes utilisation of 3D scanners for scanning of broken parts and 3D design of tailor made replacement castings. This enables the use of sophisticated technology for metal stitching repair, thread repair, furnace brazing and fusion welding for marine and power applications. As QuantiServ is available in major maritime locations as well as inland for any power plant location, the patented Lock-n-Stitch solutions can be applied on a global level to provide existing and new customers with high quality repair services. Ownership of Lock-n-Stitch was transferred to Wärtsilä on February 1, 2018.

Readers are reminded that the Chinese New Year begins in 2018 on February 16 and runs right through to March 2. Be warned however that ‘Little Year’, the run up to the main event begins on February 8 and lasts until New Year’s Eve. Any freight which shippers are considering moving out of the country needs close attention from now to avoid the delays often associated with a festival that is a very lengthy celebration.

This year it is the turn of the Dog and for those unfamiliar with the traditions of the event there are some curious superstitions that rival any oddball western sibling such as Guy Fawkes Night or Halloween. On the first day of the New Year (February 16) it is forbidden to clean or sweep, whilst for most of the country the following day is the time for married daughters to visit mum and dad along with her family and a bag of goodies her mum can pass round to the neighbours.

Day three one feeds the rats and goes to bed early so as not to disturb them, February 19 means the day of the Sheep, so no legs of lamb, but eating and drinking all night to the God of Wealth. Each day is marked by a particular animal or set of activities right up to March 2 and more details can be seen here.

SPAIN – Supply chain management company Ceva Logistics has opened a new, centrally situated, multiuser warehouse in the country. The new site is located at Alovera, an industrial area, 50 kilometres north east of Madrid. The facilities comprise 16,300 m2, in total with 400 m2 office facilities, and almost 16,000 m2 of warehousing space. Ceva already has a number of other multiuser centres in Spain, including at Subirats, in Catalonia, and in the Ontigola area south area of Madrid.

Ceva says this is the first step of a strategic process of positioning itself in the area north of Madrid, where previously it had no presence, and will enable the company to continue expanding in the near future. Easy connections to the Spanish motorway network provide simple access to both Madrid and Barcelona. The operations of an existing customer have already been successfully implemented at the new Alovera site, and the future locating of existing and new customers is well under way.

UK – This week saw the Department for International Trade (DIT) Midlands Engine ‘Selling Online’ Conference held at the Ricoh Arena in Coventry, and the event attracted around 500 retailers and manufacturers embarking on exporting products to overseas markets. Speaking at the event David Jinks MILT, Head of Consumer Research at international delivery group ParcelHero, pointed out the favourable currency rates which currently exist for British exporters. He said:

”Exporters have never had it so good! It’s to be hoped that a soft Brexit will mirror EU Single Market and Customs Union arrangements as closely as possible. Certainly now is the most cost-effective time for businesses to dip your toes in exporting to Europe and start building relationships. By starting to export now, while all the stars are in alignment for successful exporting, retailers and manufacturers will be in a well-established place and able to meet any changes in EU or US duties.”

He went on to caution that US President Trump’s lack of enthusiasm for low tariffs and free trade agreements meant America’s new minimum duty threshold of $800 (the value under which no duties and taxes are imposed on UK exports into the US) - introduced in the dying days of Obama’s presidency - could be reversed to the former $200 level if President Trump continues his more protectionist agenda.