• Advertise
  • Contact Us
  • About Us
  • Supplier Directory
  • SCB YouTube
  • Login
  • Subscribe
  • Logout
  • My Profile
  • LOGISTICS
    • Air Cargo
    • All Logistics
    • Express/Small Shipments
    • Facility Location Planning
    • Freight Forwarding/Customs Brokerage
    • Global Gateways
    • Global Logistics
    • Last Mile Delivery
    • Logistics Outsourcing
    • LTL/Truckload Services
    • Ocean Transportation
    • Rail & Intermodal
    • Reverse Logistics
    • Service Parts Management
    • Transportation & Distribution
  • TECHNOLOGY
    • All Technology
    • Artificial Intelligence
    • Cloud & On-Demand Systems
    • Data Management (Big Data/IoT/Blockchain)
    • ERP & Enterprise Systems
    • Forecasting & Demand Planning
    • Global Trade Management
    • Inventory Planning/ Optimization
    • Product Lifecycle Management
    • Sales & Operations Planning
    • SC Finance & Revenue Management
    • SC Planning & Optimization
    • Sourcing/Procurement/SRM
    • Supply Chain Visibility
    • Transportation Management
  • GENERAL SCM
    • Business Strategy Alignment
    • Education & Professional Development
    • Global Supply Chain Management
    • Global Trade & Economics
    • HR & Labor Management
    • Quality & Metrics
    • Regulation & Compliance
    • SC Security & Risk Mgmt
    • Supply Chains in Crisis
    • Sustainability & Corporate Social Responsibility
  • WAREHOUSING
    • All Warehouse Services
    • Conveyors & Sortation
    • Lift Trucks & AGVs
    • Order Fulfillment
    • Packaging
    • RFID, Barcode, Mobility & Voice
    • Robotics
    • Warehouse Management Systems
  • INDUSTRIES
    • Aerospace & Defense
    • Apparel
    • Automotive
    • Chemicals & Energy
    • Consumer Packaged Goods
    • E-Commerce/Omni-Channel
    • Food & Beverage
    • Healthcare
    • High-Tech/Electronics
    • Industrial Manufacturing
    • Pharmaceutical/Biotech
    • Retail
  • THINK TANK
  • WEBINARS
    • On-Demand Webinars
    • Upcoming Webinars
    • Webinar Library
  • PODCASTS
  • VIDEOS
  • WHITEPAPERS
Home » Will The Future See Too Many Ships Chasing Not Enough Cargo? No, Says APL CEO Ron Widdows

Will The Future See Too Many Ships Chasing Not Enough Cargo? No, Says APL CEO Ron Widdows

May 1, 2007
Global Logistics & Supply Chain Strategies

Some shipping industry analysts are warning that the near future will see a growing excess of container capacity, caused by the introduction of larger ships by major carriers. Ronald D. Widdows, chief executive officer of APL Ltd., isn't having any of it. He believes that trade growth will be vibrant enough to absorb the new capacity-and then some. Speaking at the recent Trans-Pacific Maritime (TPM) Conference in Long Beach, sponsored by The Journal of Commerce, Widdows cited predictions that containerized trade volumes will double between 2000 and 2010, to just under 120 million twenty-foot equivalent units (TEUs). At the same time, he said, capacity and fleet growth will slow, with a narrowing of the gap between supply and demand from this year onward. By 2009, he said, quoting numbers from Goldman Sachs, "demand will exceed capacity." And with shipyard orderbooks already full, carriers won't be able to catch up with the market. Julie Lim, executive director of Asia-Pacific transportation research for Goldman Sachs, agreed that severe overcapacity isn't likely to materialize any time soon. In the trans-Pacific trades, she said, "supply tends to be overestimated. Demand tends to be underestimated." Lim predicted no more than a 2-percent imbalance between supply and demand this year, not much different from what was experienced in 2006.

Widdows used that scenario to argue the need for higher freight rates. In the last four years, he said, only two carriers, OOCL and APL, showed a positive Economic Value Added. Industry's failure to generate adequate returns is largely the result of a focus on market share at the expense of profitability, he said. At the same time, carriers need capital to make necessary investments in infrastructure and cope with rising overhead, especially fuel costs. According to Widdows, there is a "broad acceptance" among industry participants of the need to increase freight rates for intermodal service, as well as for the movement of trans-Pacific cargoes to the U.S. East Coast via the Panama Canal. By any standards, the Asia-U.S. container trade is likely to continue its vibrant growth in the near term; estimates range between 8 percent and 12 percent for 2007 and 2008. Widdows also bemoaned what he views as a lack of true partnership between carriers and shippers on issues of rates and service. If the parties don't get together soon to address looming problems of infrastructure and profitability, he said, "we're all going to suffer at the end of the day."

Visit www.apl.com and www.gs.com.

    RELATED CONTENT

    RELATED VIDEOS

    Logistics Global Logistics Ocean Transportation Automotive
    KEYWORDS Automotive Global Logistics Logistics Ocean Transportation
    Global Logistics & Supply Chain Strategies

    Transplace Helps Del Monte Streamline Network

    More from this author

    Subscribe to our Daily Newsletter!

    Timely, incisive articles delivered directly to your inbox.

    Popular Stories

    • AN ARRAY OF MEDICAL DEVICES LAID OUT ON A GREEN BACKGROUND

      Why the Medical-Device Industry Is Embracing Contract Manufacturing

      Sourcing/Procurement/SRM
    • A TOY TRUCK CARRIES A GIANT BOX WITH A RED RIBBON IN A BOW

      Three Trends to Watch During Peak Season 2023

      Apparel
    • A MANUFACTURING PLANT AT DUSK OR DAWN REFLECTED IN WATER

      Uncertainty is the New Normal

      Data Management (Big Data/IoT/Blockchain)
    • On Demand Webinar_SAP.png

      Optimize your Logistics Pinch Points to Build a Risk Resilient & Sustainable Supply Chain

      Webinars
    • A GIANT CONTAINER VESSEL SPORTING THE LETTERING OF YANG MING PLIES THE SEAS

      Yang Ming Accused of Profiteering During Pandemic by Bed Bath & Beyond

      Ocean Transportation

    Digital Edition

    Scb august 2023 lg

    2023 100 Great Supply Chain Partners

    VIEW THE LATEST ISSUE

    Case Studies

    • JLL Finds Perfect Warehouse Location, Leading to $15M Grant for Startup

    • Robots Speed Fulfillment to Help Apparel Company Scale for Growth

    • New Revenue for Cloud-Based TMS that Embeds Orderful’s Modern EDI Platform

    • Convenience Store Client Maximizes Profit and Improves Customer Service

    • A Digitally Native Footwear Brand Finds Rapid Fulfillment

    Visit Our Sponsors

    Antuit Zebra Anvyl AutoStore
    BEUMER Group Blue Ridge Global Brother
    CHEP Cleo Coenterprise
    Data Capture E2open Enveyo
    Eva Air ForwardX Robotics Frayt
    GAINSystems Generix Geodis
    GEP Global Supply Chain Marketing Summit GreyOrange
    Here Holman Logistics Infor
    Inmar Kinaxis Lexis Nexis
    Locus Robotics Logility LogistiVIEW
    Lucas Systems MCA Connect MPO
    Old Dominion OneRail Overhaul
    PartnerLinQ (Visionet) Port of Virginia Ryder E-commerce by Whiplash
    Saddle Creek Logistics SAP Shyft
    Sourcemap SPS Commerce Tecsys
    TGW Systems Thomson Reuters Veho
    Verusen Walmart Workshop
    • More From SCB
      • Featured Content
      • Video Library
      • Think Tank Blog
      • SupplyChainBrain Podcast
      • Whitepapers
      • On-Demand Webinars
      • Upcoming Webinars
    • Digital Offerings
      • Digital Issue
      • Subscribe
      • Manage Your Subscription
      • Newsletters
    • Resources
      • Events Calendar
      • SCB's Great Supply Chain Partners
      • Supplier Directory
      • Case Study Showcase
      • Supply Chain Innovation Awards
      • 100 Great Partners Form
    • SCB Corporate
      • Advertise on SCB.COM
      • About Us
      • Privacy Policy
      • Contact Us
      • Data Sharing Opt-Out

    All content copyright ©2023 Keller International Publishing Corp All rights reserved. No reproduction, transmission or display is permitted without the written permissions of Keller International Publishing Corp

    Design, CMS, Hosting & Web Development :: ePublishing