empty container ship panamax construction

In network design, more than a few shipping companies use outmoded approaches to design their routes new and more powerful systems use algorithms to make better, more effective decisions about networks. In fact, fuel presents many opportunities, not just in procurement, but also in consumption. In operations, many lines treat bunker as just another cost of doing business.

In sales, for example, carriers often confuse their costs with the value received by customers and fail to charge a premium for services for which shippers will pay more. Across the enterprise, in commercial, operations, and network and fleet activities, shipping lines have opportunities to improve performance. Hidden beneath these issues (and driving them to a degree) is another set of challenges that shipping lines can readily take on. But shipping companies cannot afford to throw up their hands and accept their fate. These problems are real and significant, and largely beyond the power of any one company to address. It is now building capacity that appears will be mostly unneeded. Some of the pain is self-inflicted: as in past cycles, the industry extrapolated the good times and foresaw an unsustainable rise in demand. Several factors are responsible, notably trade’s spotty recovery from the global financial crisis, and redoubled efforts by corporate customers to control costs. Making things worse, earnings have been exceptionally volatile. The container-shipping industry has been highly unprofitable over the past five years.

Empty container ship panamax construction