Container ships arrived on-time only 66% of the time during Q1 of 2018.
This reflected a 10% decrease from Q4 of 2017, and was 6% lower than Q1 of 2017. Additionally, none of the top 17 carriers recorded a year-over-year improvement in their on-time scores, a dismal statistic for 2018.
For the shipping alliances, Ocean Alliance was the most reliable, 2M was a close second, and THE Alliance was the third most-reliable alliance.
In Q2 of 2018, some carriers saw increases in their reliability, but most still saw decreases.
Factors driving the ongoing decrease included Maersk’s acquisition of HSUD, as well as the ongoing challenges created by Maersk Line’s relaunch of their key Asia to North Europe and Mediterranean route as they seek to improve reliability and port calls.
In Q2, the Europe-Africa trade route experienced the largest decrease in reliability, decreasing from 50% in May to 33% in June.
At the same time, the Europe-Oceania trade route saw the largest improvement in reliability, surging from 46% in May to 75 % in June. The Europe-Middle Eastern trade route maintained the highest reliability among all 13 trade routes.
21 out of 22 carriers saw an increase in their reliability from May 2018 to June 2018.
Top performers for Q2 were:
- Safmarine – reliable 88% of the time.
- MCC – reliable 72% of the time.
- OOCL – reliable 70% of the time.
- CMA CGM – reliable 69% of the time.
ANL – reliable 68% of the time.
In Q3, the Europe-Africa trade route continued to have one of the lowest levels of reliability, with a further decrease.
The most-reliable trade routes during Q3 were the Europe-South America trade route, where reliability increased by 72% over Q2, and the North America-Oceania trade route, which also saw an increase.
However, in Q3, only 6 out of 13 trade routes kept their reliability unchanged, while the other 7 saw a decrease of 18%.
Top performers for Q3 were:
- CMA CGM
OOCL was a top performer for 3 consecutive months, and is expected to remain unchanged in Q4. None of the top carriers were reliable, a situation that is not expected to change as we end the year in a few short months.
Two factors that may also be contributing to poor reliability are changes in the World Container Index and the ongoing U.S. trucker shortage.
The World Container Index, issued by Drewry, shows rates down by 1.1% to $1,365/40’ container. This is $172 lower than the 5-year average on the index. The Los Angeles to Shanghai trade route is down 10%, while the New York to Rotterdam trade route is up 9%.
Drewry expects rates to continue to soften as November 2018 comes to a close. Additionally, bunker oil prices are on a strong upward trend, which is expected to continue. At the same time, idle capacity decreased sharply from April 2018 to May 2018.
The ongoing U.S. trucking shortage has led to new pricing realities for shippers. There is increased trucking demand, due to the new ELD regulation that limits the number of hours a driver can be on the road. Trucking companies are increasing the size of their fleets, but cannot find enough truckers to tackle higher demand. Additionally, there’s no indication that demand will slow down anytime soon. Current “turn down” rates are above 25% and rising.