UPS Takes Share from Expeditors as Deutsches Duke It Out, But At What Cost? — Panjiva
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UPS Takes Share from Expeditors as Deutsches Duke It Out, But At What Cost?

Corp - Forwarders 160 Mode - Seaborne 1286 U.S. 3362

The freight forwarders had another month of handling growth on U.S.-inbound, seaborne freight routes in October. Panjiva data shows total shipments handled climbed 3.5% on a year earlier. That largely reflects an increase in traffic from Asia, as outlined in Panjiva research of November 8, and will likely result in a record year for handling.

UPS did the best out of the top 10 NVOs, with a 26.5% rise in traffic on a year earlier reflecting strength from its Asian unit. That likely allowed it to take market share both from Expeditors, which grew by just 1.6%, Deutsche Post-DHL (which saw a 2.8% drop in handling) as well as Asia specialists such as Pyramid (down 9.3%).

However, Expeditors loss of volumes may reflect its continued discipline with regards to trading off market share for profitability. It maintained the highest profit margin among the forwarders covered by Panjiva in the third quarter, raising questions as to whether UPS has traded in the other direction.

THE RISE OF BIG BROWN   

Chart shows change in U.S.-inbound, seaborne shipments by NVOCC in last month on a year earlier and vs. the prior month Bubble width indicates relative number of shipments. Colors for clarity only.  Source: Panjiva

UPS expansion has not changed the forwarders’ league table, however. It had a 1.4% market share in September, well behind CH Robinson’s 1.8% and Expeditors’ 3.0%. The rise of DB-Schenker has been more notable, however. It has expanded its market share to 1.1% from 1.0% a year earlier, leading it to fourth place, displacing DP-DHL to fifth and Apex to seventh respectively.

The continued battle for market share shown by UPS and DB-Schenker’s rise provides another reason for mid-sized operators to consider consolidation as a route to growth. Both Panalpina and DSV recommitted to making acquisitions during their recent quarterly conference calls, though it has been NYK’s purchase of Yusen Logistics that has gotten the ball rolling.

BATTLE OF THE DEUTSCHES   

Chart shows ranking among NVOCCs last month (horizontal axis) and change vs. rank a year earlier (vertical)  Source: Panjiva

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