Sea container transport grew by 1.9 pct in 2015, after a 3.3 pct growth rate in 2014, while global demand is expected to grow by an annual rate of 2.2 – 3.8 pct by 2020, Boston Consulting Group said in an annual report on global commerce and sea container transport.
The report stressed that oversupply was expected to reach 2-3.3 million TEUs by the end of 2020, or 90-150 surplus vessels type Triple E, while the offer/demand balance is expected to see offer surpassing demand by 8.2-13.8 pct in 2020, fro 7.0 pct in 2015.
The report said that shipping companies in the container sector will have to adopt new strategies to survive in low demand conditions. Container transport in the Euro-Asia and intra-European lines fel 2.6 pct, in southeastern Asia transport grew 2.4 pct, while in China there was a slowdown in business. In Latin America, business fell 0.9 pct while in Africa business was slow (0.1 pct). In Asia-Northern America lines, business grew 3.5 pct.
Camille Egloff-Gika, head of shipping department in BCG, said that several container transport companies have been compressed between market leaders and companies specializing in this category and will have to improve their performance by creating scale economies, or through global mergers. “These moves will help them to reduce costs, creating synergies in a better distribution of fleet and agent networks. Maximizing synergies could reduce costs of merged companies by 5-10 pct,” she said.
The report said that forging alliances could boost pre-tax and interest earnings by 3.0 pct.