APMT COO highlights new operator reality
The chief operating officer of APM Terminals (APMT), Keith Svendsen, has identified growing competition, diminishing returns and container growth and consolidation in the liner customer base as “the reality” for terminal operators.
Mr Svendsen highlighted the factors as “market drivers” in a presentation during the keynote panel at the Container Supply Chain Conference at TOC Europe for 2018, held in Rotterdam, when he said: “I actually think that we are living through rather significant shifts in our environment already.”
APMT is implementing multiple levers to deal with Mr Svendsen’s reality, including cost reduction, customer centricity, portfolio optimisation, collaboration and operational efficiency, he said.
The presentation weighed up the situation for the different market drivers as it stood in the past against the current environment.
Container trade growth before the financial crisis was around 8% per annum but this has changed to 2%-5% per annum, and additionally there are currently emerging trade wars.
Also, the previous situation of multiple carriers competing for terminal and cargo capacity is now one where customers are consolidated into three major alliances on major trade lanes and are finding it hard to make money.
Former moderate competition with traditional regional and world players has turned into high competition leading to overcapacity in mature markets, and 2006’s peak terminal industry return of 16.9% has changed to a structural downward shift in the terminal industry and returns of 8% to 9% in recent past years.
“For us, automation is critical to stay competitive and expectations [about] the operational benefits are high, but so far benefits are elusive,” the presentation also noted.
According to the presentation, anticipated advantages are not always being realised, and APMT has faced significant challenges in addressing operations through automation.
Tangible progress will probably not be realised if terminal operators fail to adopt a proactive role towards standardisation. Current standardisation efforts are mainly supplier-driven and are unlikely to yield significant breakthrough results at any point in the near future, APMT added.
LATEST PRESS RELEASES
Cone Fenders delivered for Malayan Flour Mills Jetty and Cruise Terminal in Phuket Read more
The new high dimensions gantry crane STS Malaccamax rated amongst the largest cranes in the world an... Read more
The contractors THV Artes Depret – Franki formed a temporary partnership to construct the new lock i... Read more
Port terminals worldwide have begun to deploy new simulation technology that's making the operator t... Read more
BENSCHOP (NL) – Terberg announces a new generation of Yard Tractors. These innovative Yard Tractors ... Read more
The lock Langwedel is one of numerous locks along river Weser in Northern Germany. It is operational... Read more