LOGISTICS SECTOR OVERVIEW...Property of Expeditors International of Washington, Inc. and its subsidiaries. Reproduction by written authorization only. LOGISTICS SECTOR OVERVIEW

Property of Expeditors International of Washington, Inc. and its subsidiaries. Reproduction by written authorization only.

L O G I S T I C S S E C T O R O V E R V I E W

1. State of the industry

• Customs

• Air

• Ocean

• Domestic

2. Future Outlook & Trends

3. Finding the Signal in the Noise

Trade ImpactsState of the industry Capacity & Demand

Focus on Execution Carrier LandscapeLogistics ProvidersDigital DisruptorsAdditional Impacts

Pre-COVID-19

Current

Future


Global PandemicPost EntryMonitoringComplexity

Compliance controls upstreamData and Reporting Strategic RelationshipsInnovation

Understanding = Complexity can lead to opportunity

Global InfrastructureLocal Expertise

Knowledge Based Approach

Political & Economic Uncertainty

Global PandemicGovernment Audits

2020

2020 OUTLOOK BACKDROP

A I R M A R K E T


ALPHALINER - Monthly Monitor 2020

DEMAND


GLOBAL CAPACITYIMPACT OF PASSENGER FLIGHT CANCELLATIONS GLOBALLY

Source: Seabury


WHAT TO EXPECT

more uncertainty…

O C E A N M A R K E T


Capacity OperatingExpenseFinancial

PerformanceOutsideFactorsDemand

OCEAN MARKET LEVERS

• GDP• Global Trade +/-

• Environmental• Cyber-Security• Labor• Political• Regulatory

• Carriers earnings • Rates/revenue• Operating expense• Debt to equity• Cost of capital

• Fuel• Assets• Terminals• Labor• Technology

• Existing fleet• New • Scrapped• Charter market • Growth +/-


C O N S O L I D A T I O N3 alliances, 9 global carriers

Source: Alphaliner

CMA CGM & APLCosco & OOCLEvergreen

Current Alliances April 2020: HMM Joins THE Alliance

Alliance Capacities:

5.09 Million TEU

7.73 Million TEU

7.93 Million TEU


ALPHALINER - Monthly Monitor 2020

DEMAND


CAPACITY

ALPHALINER - Monthly Monitor and Newsletter 2020


SUPPLY - CAPACITY

ALPHALINER –Monthly- 2020


RatesFall

Capacity Reduced Demand

Increased

Rates Increase

Capacity Increased Demand

Decreased

Capacity Surplus

Capacity Shortage

SUPPLY & DEMAND

CYCLE

WHERE ARE WE NOW?

D O M E S T I C M A R K E T


S T A T E O F T R U C K I N G


STATE OF WAREHOUSING & DRY VAN

F U T U R E O U T L O O K & T R E N D S

High Enthusiasm

High Customer

Value

Low Enthusiasm

Low Customer Value

Assess Leverage Lead

BlockchainMachineLearning

AI

RPAAlgorithms

BigDataVirtual

RealityMobile

IoTCloudSocial

AnalyticsCyber-

SecurityChatbots

API

One GlobalSystemDigital

Documents

DigitalTwin


TECHNOLOGY


A G I L I T Y A S C O M P E T I T I V E A D V A N T A G E

FlexibilityThe ability to respond to disruptions• Design for postponement• Propagate visibility across the supply chain

AdaptabilityThe ability to react and exploit opportunities• Implementing new business models or

products• Identify and evaluate alternate supply

sources


S U P P L Y C H A I N H E A L T H C H E C K


P A C E O F V I S I B I L I T Y


S I G N A L I N T H E N O I S E

• Never waste a good crisis – heed lessons left and right

• Ensure you have the right alignment with partners• Rates will eventually (2021) stabilize but expect

them to remain higher as capacity remains tight across all modes

• Space and Flexibility is the name of the game, to manage through the Supply/Demand imbalance

• Ocean carriers financials will improve (much needed) but still remain unstable

• Transit times will be volatile – Carrier, terminals, truckers, chassis, space all contribute

• Possible consolidation across all sectors• Just in Case vs. Just in Time• Tariffs and Politics will continue to disrupt


Q U E S T I O N S ?

Questions ?

Michael MooneyRegional Vice President

Mobile: +1 206-683-2865Email: [email protected]

E X P E D I T O R S . C O M

Questions?

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