Shift from air freight to sea freight detected
October 31, 2012 Category Airlines and airports, Logistics
More companies are shipping their products by sea instead of by air in a shift that is seen as a permanent trend. Alfred Hofmann, Senior Vice President for Sea Freight in the Asia-Pacific at logistics firm Kuehne+Nagel, said “it’s a trend that can’t stop”. Nick Rhodes, Director of Cathay Pacific Cargo, tended to agree with the prognosis. “Our loads are definitely down but it is hard to say how much is due to less production, more competition or a modal shift. A bit of each, I suspect,” he added. Hofmann said the pharmaceutical industry and manufacturers of temperature-controlled products were at the “forefront of change” from airfreight to sea freight. He pointed out that high-technology electronic manufacturers aimed “to convert over 50% of notebook shipments to ocean”. “Tablets go by ocean after the first wave by air,” he told about 600 shipping, logistics and manufacturing executives at the Journal of Commerce TPM conference in Shenzhen. Hi-tech industries began moving shipments from air to ocean about three years ago. At the time, cargo airlines were unsure if it signaled a short-term trend in response to the poor economic conditions or a structural shift. Moving 10 tons of cargo by sea from Shanghai to Los Angeles was slightly more than 5% of the cost of moving the same cargo by air – USD2,600 versus USD46,000. Container line Matson said the transit time to ship a container from Shanghai to Los Angeles was 10 days, compared with four days by air, depending how much cargo owners paid to transport their freight. Logistics firm DB Schenker said shipping freight by sea from Shanghai to Hamburg would take 28 days, compared with four to six days by air.
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