Kuehne+Nagel CEO sees market revival
Published: Tuesday, Jun 25th 2024, 10:10
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At the logistics group Kuehne+Nagel, the signs are pointing to an upswing: after a long downturn, sea freight in particular is on the rise again, as CEO Stefan Paul said in an interview with the news agency AWP.
According to the company boss, one could speak of a "real revival of the sea freight market". Freight rates, i.e. the prices for container transportation, have almost tripled in recent weeks.
One reason for this is that empty containers have become scarce. This is a consequence of the de facto closure of the Suez route due to the attacks by the Houthi rebels. According to Paul, 15 percent of the available container ship capacity worldwide has been absorbed because the ships have to sail around the Cape and are therefore traveling longer.
At the same time, some customers have started to bring forward shipments for the Christmas business due to the uncertainty. "Shortages are therefore being met with a selective upturn in demand," says the CEO.
Complexity increased by leaps and bounds
Or to put it another way: complexity on the world's oceans has "increased by leaps and bounds" in recent weeks, Paul continues. And, as we all know, the company benefits from complexity. This is because it leads to a higher demand for logistics services. Most recently, Kuehne+Nagel experienced a real boom during the pandemic due to the extremely difficult conditions at the time.
In addition to sea freight, which recently contributed a good third of turnover, there is also a trend towards higher volumes in air freight, according to the Kuehne+Nagel CEO. "We are talking about high single-digit growth here." This is a clear sign of a trend reversal. And overland transport is also currently "very slightly up on the previous year".
Incidentally, the company boss is not worried about the current de-globalization trends. "I don't see the current protectionist movements as a booster for us, but as a positive trend for our business - because our customers need more advice."
Klaus-Michael Kühne still present
A special feature of Kühne+Nagel is the dominant major shareholder Klaus-Michael Kühne. Despite his advanced age, he is still present. "I have contact with him several times a week. And it's worth it. Because thanks to his decades of experience, he still has a nose that others don't have."
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