Container Ships Must Alter Course for Profitabality Says Report

Press Release
Tuesday, October 16, 2012

Container carriers can recover from the losses they suffered in recent price wars by adopting more disciplined business practices, says a new report.

The recently published report by The Boston Consulting Group (BCG) is titled 'Charting a New Course: Restoring Profitability to Container Shipping'. It finds that the container-shipping industry’s poor performance in 2011 and its continued struggles in 2012 are primarily the result of a self-inflicted supply-and-demand imbalance, which triggered intense competition and price wars.

The report goes on to explain how the industry is harming its own economics by following misguided practices—especially those affecting capacity and pricing decisions. The authors also discuss how other factors conspire to make profitability more elusive than in other industries and describe the challenging near-term outlook.

The report discusses a wide variety of strategic, commercial, and operational initiatives that each carrier can undertake to chart a new course—for itself and the industry as a whole—and offers ten imperatives for sustaining profitability. Key themes are:

  • Defining an effective strategy aimed at achieving a competitive advantage and built on shoring up key infrastructure assets, establishing stronger alliances, and selectively pursuing M&A
  • Demonstrating the value of offerings (including commodity and premium services), setting prices according to market position and customer relationships, and monetizing all service offerings
  • Rigorously managing and variabilizing costs to enable critical improvements in operational efficiency
  • Enabling informed and data-driven decisions by establishing a robust IT infrastructure, applying business and market intelligence, developing and retaining the right talent, and creating clear metrics to track performance

As the foundation for these moves, carriers must shift their mindset to apply more disciplined practices and compete selectively to ensure a profitable business. “Carriers can no longer rely on a one-size-fits-all approach,” said Dinesh Khanna, a BCG partner and coauthor of the report. “They must decide how and where to compete by analyzing profit pools and the cost to serve specific markets and customers.”

A copy of the report can be downloaded here.


 

Maritime Reporter February 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

People & Company News

Obangame Express 2015 Concludes in the Gulf of Guinea

Maritime forces from Gulf of Guinea nations, Europe, South America, and the United States and several regional and international organizations concluded the multinational maritime exercise,

Scandlines Ferry Back in Service by End June

The damaged Scandlines ferry M/V Prinsesse Benedikte is being repaired at the Polish shipyard Remontowa and is expected to be ready before the end of June 2015.

Greece Will Sell Piraeus Port Stake in Weeks

The Greek government will sell its majority stake in the port of Piraeus within weeks, the country's deputy prime minister told China's official Xinhua news agency,

Finance

Scandlines Ferry Back in Service by End June

The damaged Scandlines ferry M/V Prinsesse Benedikte is being repaired at the Polish shipyard Remontowa and is expected to be ready before the end of June 2015.

Greece Will Sell Piraeus Port Stake in Weeks

The Greek government will sell its majority stake in the port of Piraeus within weeks, the country's deputy prime minister told China's official Xinhua news agency,

India May Add Japanese Soryu-Class Submarines to its Fleet

India is reportedly considering a project to incorporate six Japanese Soryu-class diesel-electric submarines into its fleet, says The Japan Times.   The Defense

Container Ships

Gulf Bridge Express Service to End

The Gulf Bridge Express Service will shortly be terminated with the last roundtrip voyage being MV Saint Nikolaos voyage 00008S, ETA New Orleans on April 22, 2015.

Container Ship breaks Down off Essex Coast

Lifeboats from Walton and Frinton, and the Harwich have been called out to a container ship ANL Warringa off the coast of Essex which had been reported to be drifting in a major shipping lane.

Mediterranean Rescue Operations Strain Shipping

The Wall Street Journal ran a story yesterday describing how the increasing number of seaborne migrants making the journey from Africa to Europe has not only

Logistics

Gulf Bridge Express Service to End

The Gulf Bridge Express Service will shortly be terminated with the last roundtrip voyage being MV Saint Nikolaos voyage 00008S, ETA New Orleans on April 22, 2015.

China Unveils Action Plan on Maritime Silk Road

China has unveiled the principles, framework, and cooperation priorities and mechanisms in its Maritime Silk Road initiative in a bid to enhance regional connectivity

China Maritime Silk Road to Touch India for Namesake

Chinese officials on Saturday fleshed out some details for the country's ambitious 21st Century Maritime Silk Road (MSR) project in its “one belt, one road,” action plan.

 
 
Maritime Contracts Navigation Offshore Oil Pipelines Port Authority Salvage Ship Electronics Ship Repair Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.2105 sec (5 req/sec)