We must free ourselves of the hope that the sea will ever rest. We must learn to sail in high winds.
In our March 2015 report, The Transformation Imperative in Shipping: Mastering the Next Big Wave, we drew on our analysis of events in 2014 to forecast choppy seas for an industry buffeted by powerful forces. In particular, we noted the persistent overcapacity that had been eroding shareholder returns despite reasonably high volume growth. We also proposed a way in which container carriers could make the transformations necessary to succeed in an increasingly volatile and complex environment.
Our analysis of developments that unfolded in 2015 affirms that the industry still faces daunting challenges. Until then, global volume growth of containers shipped worldwide had been decent: from 2010 through 2014, 4.5% annually. It was overcapacity that presented the primary threat to shareholder returns. In 2015, for the first time, the industry faced weak demand, surprising all observers.
For this report, our aim was to understand whether this trend will prove cyclical or become a new normal. We conducted in-depth analyses of demand-side developments during 2015, reviewing those that affect major global trade routes, or trades, and key drivers of container demand. To gauge whether the trends we’re seeing will prove temporary or permanent, we considered how demand drivers could change in the next several years. Finally, we assessed moves that carriers, or container liners, can explore to defend their competitive position and further sharpen their edge.
One thing is clear: in this seascape, container-shipping companies that can continue to drive change stand the best chance of steaming ahead of their less progressive peers.