The Digital Imperative in Container Shipping

Transcription

1 The Digital Imperative in Container Shipping

2 BCG is the leading strategy advisor in shipping 350+ projects in last 3 years across entire value chain Operators, owners, managers Tanker, bulkers, containers, other segments Ship finance and Private Equity Across all continents Across all relevant topics Dedicated team of ~70 Shipping Consultants based in 6 BCG Maritime hubs Thought leadership, proprietary tools and best practices Source: BCG Los Angeles Hamburg Copenhagen Athens Seoul Singapore BCG s Global Shipping Hubs (~70 experts world wide) 85 BCG offices world-wide, 48 countries Abu Dhabi Amsterdam Athens Atlanta Auckland Bangkok Barcelona Beijing Berlin Bogota Boston Brussels Budapest Buenos Aires Calgary Canberra Casablanca Chennai Chicago Cologne Copenhagen Dallas Denver Detroit Dubai Düsseldorf Frankfurt Geneva Hamburg Helsinki Ho Chi Minh Hong Kong Houston Istanbul Jakarta Johannesburg Kuala Lumpur Kyiv Lagos Lima Lisbon London Los Angeles Luanda Madrid Melbourne Mexico City Miami Milan Minneapolis Monterrey Montreal Moscow Mumbai Munich Nagoya New Delhi New Jersey New York Oslo Paris Perth Philadelphia Prague Rio de Janeiro Rome Riyadh San Francisco Santiago São Paulo Seattle Seoul Shanghai Singapore Stockholm Stuttgart Sydney Taipei Tel Aviv Tokyo Toronto Vienna Warsaw Washington Zürich 1

3 In 2017, overcapacity appears to be somewhat improving. This is driven by: Soft rebound in global demand (~4.5% y-o-y) Small deceleration of capacity increase (~4% y-o-y) Container shipping still in a vicious cycle though soft rebound signs are visible Incentive to build new vessels Overcapacity Low industry returns Downward pressure on freight rates 2

4 Overall, 2020 capacity overhang is forecast at ~6-9% TEU capacity on water vs container demand (millions of TEUs) Bull scenario 1 Base/bear Bull scenario 1 22 Base case TEU Supply 20 TEU Demand % % 6.9% 7.8% In 2020, excess capacity in the range of M TEU, the equivalent of ULCV Source: IHS World Trade Service (2016); Alphaliner; Drewry; BCG container flow model 9.2% 10.7% % 9.7% % 9.7% Bear scenario 3

5 At the same time, digital players are raising the stakes Forwarders capturing customers Tech giants are entering Start-ups on the rise NYSHEX Innovative alternatives in the long-term 4

6 Venture Capital Funds are Investing Heavily in Shipping and Logistics Digital Startups Venture Capital Investments focused on digital disruption , $millions Company receiving the largest investment 2,997 e-platforms Advanced Analytics Internet of Things Artificial Intelligence Autonomous vessels and robotics Flexport Yimidada NinjaVan Geek+ Sea Machines Source: PitchBook; BCG analysis 1. Covers investments made from January 2012 through September 2017 $3.3 3,334 billion Total 5

7 Seven Digital Trends Will Transform Container Shipping e-platforms Advanced Analytics Internet of Things Artificial Intelligence Autonomous Vessels and Robotics Blockchain Cyber Security Major impact areas Planning Operations Commercial Support functions Source: BCG analysis Online booking Online cargo management Customer personalization Network optimization Lead generation Demand forecasting Dynamic pricing Empty repositioning Vessel machinery monitoring Reefer container conditions monitoring E-service centers (e.g. customer call centers) Dynamic capacity reallocation Predictive maintenance Automated vessel navigation Automated port calls e-bill of Lading Payment automation Cargo insurance Significant impact Security assurance for customer data Security assurance for automated operations 6 Disruptive impact

8 7 With the right ambition, resources and scale carriers can achieve a step change in their digital capabilities within 18 months

9 Five imperatives for success Develop a clear vision for Digital Commit to rapid adoption Lay the foundation Incubate outside the organization Test, and then scale fast 8

10 A Holistic Approach to Digital Transformation WHY Define the vision Business Needs Inspiration Pace WHAT HOW Source: BCG analysis Digitalize the core Build new digital offerings Solidify the foundation Structure & processes Planning Commercial activities Strengthen/disrupt core Data & systems People Operations Support functions Create new businesses Partner ecosystem Change management 9

11 If you want to know more: Digital approach by Sector Search on Google for ""Center for digital in transportation" "The digital imperative in Container Shipping" Client testimonials Expert network 10

12 bcg.com