Kuehne+Nagel does not benefit in the air from the crisis in the Red Sea
Published: Friday, Mar 1st 2024, 11:31
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The Schwyz-based logistics group Kuehne+Nagel has not yet benefited in air freight from the problems that sea freight is currently experiencing due to the situation in the Red Sea. According to CEO Stefan Paul, there are various reasons for this, as he said on Friday at the Group's annual media conference in Opfikon, Zurich.
During the coronavirus pandemic, problems in sea freight and supply chains had led to a real boom in air freight. This is not the case now, as global supply chains are currently functioning very well, apart from the problems at the Suez Canal, emphasized Paul. In addition, demand from end customers is generally low at the moment, as the economy is rather weak in many countries.
After all, sea freight itself should benefit financially from the crisis in the Red Sea in the coming months. Freight rates have risen, which will also give Kuehne+Nagel a certain tailwind in terms of profitability. "We are talking about EBIT in the double-digit millions from the second quarter onwards," says Paul.
Kuehne+Nagel can also make good use of this. The Group recorded a significant decline in earnings at all levels in the 2023 financial year. The pandemic-related boom of 2021 and 2022 is history. In sea freight, the low point was at least passed in the fourth quarter, as the Group's management emphasized. The signs are now pointing to growth again. However, there can be no talk of a special economic situation à la Corona, it said.
Incidentally, Kuehne+Nagel had to divert a total of 400 to 450 ships around Cape Horn due to the crisis in the Red Sea. According to CEO Paul, the journey took twelve days longer than through the Suez Canal.
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