Maersk ends contract with DB Schenker over attempts to steal clients
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An agreement between two giants of the logistics industry has been terminated after Maersk decided it would not tolerate DB Schenker’s attempts to pinch customers from its freight forwarding company Damco.
Back on September 1st, the Danish shipping giant announced a major restructuring plan that included Damco being integrated into the company by the end of the year – a move that would put an end to the Damco brand.
Less than a week later, DB Schenker declared their intention to offer Damco customers a „stability package” that would reduce uncertainty while improving reliability and security at the same time. It is said that DB Schenker’s attempt to steal Maersk’s customers upset Maersk CEO Søren Skou to the extent that he ordered the company’s credit service to be cancelled. As a result, DB Schenker now has to pay cash for each of its bookings.
The spat between Maersk and DB Schenker has understandably generated plenty of debate online, not least on Linkedin, where a number of industry figures have been giving their 2 cents.
Hans J. Willam, Managing Owner at WCL – Worldwide Consultants in Logistics, has said that he doesn’t understand why Maersk „overreacted” to DB Schenker’s activity:
I don’t understand why Maersk has „overreacted” regarding DBSchenker assuring Damco FCL customers not to worry. Damco is/was a NVOCC. DBSchenker is a NVOCC. But Maersk has decided to discontinue the NVOCC activity of Damco. Let’s be clear: The new Maersk is a VOCC (used to be called Maersk Line), a Freight Forwarder (incl. Airfreight) and a Solutions Provider (Buyer’s Consolidator/SCM). Thus Maersk is „not a NVOCC”! What’s even more interesting: Maersk has already hired a no. of Freight Forwarding Professionals. Thus it is clear that Maersk will go after the BCO business which is „today largely controlled by the NVOCC customers of Maersk” (i.e. the Top 20 NVOCC’s). Any which way: Maersk will not/cannot support their NVOCC customers much longer… Possibly Maersk will target the customers of DBSchenker first. Let the BCO’s decide who they want to work with, particularly if the BCO’s are looking for a neutral „consolidator”. Interesting times ahead…
Meanwhile, Diego Barriga, Director Commercial Excellence & Projects at Hapag-Lloyd AG, has described Maersk’s decision as „an interesting development”:
Interesting development. I wonder how many more “breakups” are really possible. There is only so much capacity and most of it controlled by the top 6 carriers. Top forwarders must be careful not to over commit with one line vs. another (and this move points in that direction). Could the same happen with CMA logistics and CMA who walk away from their top NVO partners as a result of new carrier strategies? Carrier forwarder hybrids could trigger changes in the way the industry does things.
Could we be set to see a „proper world heavyweight fracas” as an insider predicted last month? Could we see more breakups? Let us know your thoughts in the comments.
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