Supply chain radar: Mid-game gambits – the next moves in DSV + PAN vs CMA CGM + Ceva
I am afraid this is a quick and dirty take with no numbers at all ...
Container haulage is plagued by “turmoil” and “chaos” that many fear will get worse as the peak season gears up.
One forwarder told The Loadstar all UK ports had been affected by problems ranging from driver shortages and rail failures to issues arising from M&A activity.
Advance road bookings now require up to 10 days lead time.
“We are seeing failures on some 20% of the boxes we handle; that’s thousands of boxes, and from what we are hearing some of our competitors have it worse,” said the forwarder.
“It’s leading to a loss of confidence in the industry, and at points has left us questioning whether it is worth continuing.”
The port of Felixstowe has borne the brunt of the industry’s ire, thanks to the delays and congestion resulting from its efforts to integrate a new IT system. Last week, OOCL and CMA CGM announced they were withdrawing services and redirecting them to other UK gateways.
MSC has now announced it will divert its India/Pakistan-Europe IPAK service to London Gateway from next week.
“People are now actively avoiding Felixstowe, because of its IT issues, and redirecting services into regional ports,” the forwarder continued. “Liverpool generally does not experience any issues but even there we are seeing delays and backlogs.”
However, another forwarding source noted that while the port of Liverpool had experienced some issues, they had been relatively short-lived. He said “a few” larger ships had been diverted from southern ports into Liverpool, affecting operations for a “couple of days”.
He added: “Drivers were waiting up to eight hours to collect a container, but only in a certain area of the port – which did create some unrest.
“It didn’t take long to get back up to speed, with us collecting five to six containers per day, delivering to our warehouse, unloading and returning the empty with one driver.”
For the wider industry however, another forwarder told The Loadstar, the core issue was a lack of haulage – a view that appears to be supported by carriers demanding seven to 10 days advance booking. Those that fail to book this far in advance have been unable to get access to haulage space.
“If expectation for booking is 10 days, whereas previously the entire turnaround could be completed in three days, that tells you there isn’t the haulage capacity,” said the forwarder.
“This causes its own problems, with ‘pay and play’ taking effect and hauliers only working for the highest rates. Those unwilling to pay? Tough, the hauliers will find work elsewhere.”
The Loadstar approached several haulage companies for comment, but as we went to press they had not responded.
“There is no single [supply chain] issue, but haulage is certainly at the front of a confluence of factors that are to blame,” said the forwarder.
“We’re seeing an upturn in demand at the same time as a drop in available drivers – and why haul containers in unsociable hours when you can make more driving for Tesco?”
Alongside the lack of available road haulage, the UK is also suffering from limited rail capacity, and with peak season approaching it is likely to get worse.