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COVID-19 & Brexit Update December 2020Published on 1 December 2020
It has certainly been an interesting year for all of us, both in business and in private life. As the year is now ending, we would like to give you a 2020 year-end update on where we are as a company and what we see happening in the relocation and logistics industry.
We are pleased to report that the Voerman Group has seen a rather stable year after the big dip in Spring when COVID hit in Europe. Some branches of the Group have done very well amidst this crisis and all the branches have performed better than we expected at the moment COVID hit.
The industry has been significantly affected by the pandemic as well as the Brexit measures that many countries have implemented. These influences have caused a global imbalance of containers which is resulting in shortages, fast rising sea and airfreight pricing, and much longer transit times. Also, the ports in the UK are congested and it is expected that European ports, such as Rotterdam, will see congestion in early 2021.
With this update, we would like to advise you on some of these specifics as they will have an impact on global mobility in the coming months. Our customer service staff will work closely with the families moving as well as our corporate contacts to keep everyone proactively updated. We will look to secure dates for packing or delivery during the next few months as soon as orders are in and book the transportation promptly. We do, however, recognize that it can be difficult in the coming months to pre-confirm dates for transferees, due to the ongoing immigration or travel restrictions. We will need flexibility on both sides to meet the preferred packing and delivery schedules. Also, we foresee a rise in transportation costs due to surcharges during the relocation
In general, we expect:
- Continuing surcharges due to extra protection and restrictions related to COVID-19
- Shortage of containers due to shortage of capacity of ships (currently 40,000 TEU waiting for transportation)
- Fast rising cost of sea freight (e.g. Asia – Europe has seen an increase of ca. USD 3500 per TEU)
- Fewer number of transits by ship or air carrier (various carriers don’t take household good shipments anymore)
- Airfreight costs to remain at a very high level for a while
- Increase in fuel charges after lowest points
- Heightened border controls, causing delays in intra-European traffic
- Storage charge increase due to high demand
- 20 – 30% overall decrease of operating capacity in global market
- A market picking up pace again towards year end 2021 and the expectation that we will see growth back when trust is established in international travel
It is partly a crystal ball that we are trying to look into, but we are actively involved in industry associations in all continents to make sure we are prepared to serve our clients. Our supply chain team has increased the service capabilities for us as a Group and The Harmony Relocation Network helps us a lot to create operating capabilities. Our account managers will keep you updated as we progress in 2021.
We would like to wish you, your family and your colleagues a great holiday season ahead. It has been a strange year, but hopefully you are able to enjoy some pleasant times in the coming weeks with your loved ones (Corona proof).
We are happy to continue to serve you and your colleagues.
On behalf of the Voerman Board
Wiebe van Bockel
Chief Commercial Officer