Shipping is the circulatory system of the global economy. And as the economy’s metabolism gets sluggish, it appears that shipping is slowing down with it – quite literally. Freighters and tankers are steaming at reduced knots per hour.
Today’s Wall Street Journal also shows how boats are going the long way round to avoid toll charges at the Suez Canal. Supply chains are affected, all the way down to consumer and business buyers. Channels are feeling the pain.
Cost-cutting is certainly needed. But I hope owners aren’t decreeing half-speed ahead and manaña deliveries across the board. Efficient, long supply chains are fine, but it would be a serious miscalculation to let all their container vessels (read: valuable and costly inventory!) be caught at sea when smart competing skippers are racing into port.
Trade- and end-customers with time-sensitive cargos will defect, and once the economy rebounds they may not come back. Conceptually, these customers might appreciate that providers have to lower their costs to stay solvent. But no customer fully gets it that benefits to them – availability in this case – should have to fall too. And that is why shippers (and buyers?) who figure out how to maintain at least the illusion of a satisfying shipping experience for their customers will come out of this period stronger than ever.