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Shipping Lines Dive Deeper into Logistics and Air Cargo in 2021

Shipping Lines Dive Deeper into Logistics and Air Cargo in 2021


2021 saw significant steps toward transferring big ocean freight lines into providers of inland logistics services. This is a trend that is blurring the line between freight forwarders and carriers. and certainly not a new one where we have in the past seen Maersk attempt this before with Maersk Logistics and thence DAMCO and the ill-fated APL Logistics that was a separate business entity of American President Lines that was acquired by Singapore’s national flag carrier, NOL.

Due to a number of factors, both entities ran aground and DAMCO was subsumed back as part of MAERSK and APL Logistics was offloaded to Japanese forwarder KWE back in 2018.

Previously, an asset-light business model dominated the logistics sector. With the supply chain crisis and the growth of Amazon’s logistics network, the sector has demonstrated the value of controlling capacity rather than being completely reliant on third parties.

Many container lines established logistics divisions years ago but focused on short-haul port drayage, transloading, or intermodal moves.

In 2021, the major carriers invested in becoming integrated logistics hubs where customers can order individual services or bundled solutions from an end-to-end international supply chain management menu. Some carriers also invested in port terminal operations to better guarantee access and prompt handling for their vessels.

For example, Maersk announced before Christmas that it made a US$3.6 billion deal with Hong Kong sourcing expert Li & Fung for its LF Logistics subsidiary.

In early November, it agreed to acquire German freight forwarder and air freight specialist Senator International for $644 million.

Maersk ordered two new Boeing 777 freighters for its in-house airline Star Air and leased three Boeing 767-300s, starting in 2022.

CMA CGM announced a $3 billion deal for the e-commerce and life cycle units of technology distribution giant Ingram Micro in December.

Meanwhile, the Mediterranean Shipping Company (MSC) is close to buying Log-In – Logistica Intermodal, which operates coastal vessels, as well as port and intermodal terminals in Brazil and lower South America. Another trend that the industry will be watching is the rise of port operators who also have similar plans and intentions.

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