The Lowdown On Low Carrier Reliability

 In container carriers, Container Shipping & Transport, International Shipping, shippers

Carriers Deliver Cargo Late Over a Third of the TimeYour imported cargo was supposed to arrive today. But it doesn’t. Instead, it will arrive tomorrow. Or the next day. Maybe even later…

If you’re an international shipper, there’s a good chance you’ve experienced this. What’s worse, you may have noticed it happening more often lately.

In trades all around the world, carriers, or shipping lines, are delivering poor reliability to their customers. Instead of improving, carriers seem to be getting worse and worse when it comes to reliability in cargo shipping.

Drewry reports:

LINER schedule reliability fell to its worst level in 12 months in February when the average on-time performance slipped by seven percentage points to 62.7 per cent, according to Drewry’s Carrier Performance Insight.

Can you imagine being on time with your work only 62.7% of the time? That would mean over a third of the time you’d fail to meet your employer or client’s expectations.

How long do you think an employer would allow that to go on before they fired you? How long do you think it would take a client to leave you for a more reliable competitor?

Maybe last month was just a bad month for carriers and that’s why carriers had their lowest on time delivery percentages in a year. Drewry does point out that the severity of poor reliability from carriers was exaggerated by the Chinese New Year.

Perhaps Chinese New Year did exaggerate the poor reliability problem, but it didn’t create it. February was not some aberration. On-time delivery from carriers has been decreasing month after month. Last time I checked, Chinese New Year doesn’t happen every month.

The on-time average has now fallen in each of the previous five months and is now at its lowest point since the US west coast labour dispute-affected February 2015 when the average was 55.2 per cent.

Yeah, don’t remind us of the labor dispute between the ILWU and PMA, Drewry. Shippers have been trying to get that bad taste out of their mouths for quite some time while trying to recover from the losses it caused.

That poor reliability from shippers is pushing on-time numbers anywhere near those during the contentious contract negotiations at West Coast ports is sickening.

Words relating to sickness are the best for describing carrier performance right now. It’s a joke around my house that when either my wife or I get sick, we describe the illness or its symptoms as “a general malaise”. But it is no joke when Drewry describes carrier performance and reliability with the words “widespread malaise”.

And that came right after talking about the top carriers in terms of reliability as well as the only two carriers that managed to improve their reliability at all in February!

For the third straight month, the same carriers occupied the top three spots in February.

Japanese carrier MOL finished on top yet again with an average on-time performance of 73.6 per cent, well down on its leading score of 82.7 per cent from January.

Wan Hai took second place with 71.4 per cent, down from 79.5 per cent, while in third place Maersk Line had an on-time average of 70.1 per cent, down from 77.0 per cent.

Only two carriers, MSC and Zim, made marginal improvements on their January performance and the widespread malaise saw the spread from the most to least reliable carriers narrow to 18 points.

The top performer in reliability came in at delivering on time only 73.6% of shipments? That means over a quarter of the time, shippers can expect to receive their cargo late from the most reliable of carriers!

When carriers started announcing all the ship sharing agreements they were making, one of the benefits was supposed to be increased reliability for shippers. Yet, with carrier alliances dominating the trades, carrier reliability is getting worse.

This is one of the reasons we posted the blog Should Maritime Regulators Rethink Carrier Alliances?

It’s time to demand more of carriers. Shippers can’t get away with late delivery over a third of the time in their businesses; why should carriers be allowed to get away with this kind of performance?

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Source: UC Blog

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