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Industry Overview

While many industries are still experiencing an overflow of inventory due to low consumer demand, the automotive industry is on the rebound. S&P Global Mobility expects new vehicle sales globally to reach nearly 83.6 million units in 2023, a 5.6% increase from 2022. While the trend is currently trending upwards coming out of the pandemic, macroeconomic challenges could impact this growth, and evolving market conditions could introduce new challenges. 

Even with this projected growth, the automotive industry is experiencing pressure to reduce operating costs and emissions. 

Near-shoring, re-shoring, and friend-shoring – these terms have come up more frequently in supply chain discussions since the U.S.-China tariffs were established in 2018. Since there is a lot that goes into moving or establishing a new plant, including manufacturing space, labour, raw materials, etc., there was no substantial movement on this strategy before or during the pandemic. 

Recently, more companies are taking the leap to diversify their supply chains through reshoring, particularly in the automotive space. As an example, Volkswagen announced they are establishing an EV plant in Canada and Tesla and BMW are establishing plants in Mexico. 

The National Association of Auto Transport in Mexico expects to grow 20% in the next 4 years as a result of nearshoring efforts. In Mexico alone, 13 of the states experienced a 12% growth in foreign direct investments last year. 

Change is never easy, especially if your supply chain is on track using the same strategies you have been using the last decade. But today’s supply chains are much more complex, and companies are under greater cost-pressures. The automotive industry is just one example of what out-of-the-box thinking can get you – increased savings, efficiencies, and a more resilient supply chain. 

Airfreight Update

There has been a slight increase in demand since mid-March as compared to the first few months of the year, driven by quarter-end push and increasing ecommerce demand. Expect the increasing demand to continue and stabilise around the middle of May prior to the quarter-end uptick. 

Capacity is sufficiently available across most trade lanes as further passenger flights continue to resume operations. Rates have trended upwards but will continue to stabilise and remain competitive throughout the rest of the 2nd quarter of 2023. 

North America 
United States export capacity is generally open, and rates continue their downward trend. Expect additional capacity entering the market in the coming months to support increased travel demand. 

South Asia, Middle East and Africa
The Indian market remains steady with capacity available for U.S. imports. Spot rates on U.S. imports continue to trend down as capacity grows and demand remains light. U.S. exports to Indian markets are relatively well balanced between capacity and demand, leading to more predictable transit times. 

Latin America
Export conditions remain mixed in Latin America. Northbound “seed season” from Chile, Argentina, and Uruguay started early March and will continue to about mid-May, mainly supported by dedicated charter flights. 

  • Argentine seed volumes are relatively low and capacity from Buenos Aires is available
  • Brazil capacity and rates remain stable on major routes
  • Colombia had their peak season for flowers from 3 April to 22 April with capacity now relatively available 

Global Freight Update

Ocean freight demand on most trade lanes are generally flat. However, rates have reached unsustainable levels for shipping lines, which are pushing more aggressively for rate increases. 

Shipping lines continue to void sailing to balance the supply. They are also slow steaming – or taking longer routes – via the Cape of Good Hope on the backhaul legs of major East-West services. This will impact time sensitive commodities due to longer transit times. 

Congestion is mostly gone, however the need remain for some flexibility as blank sailings and service adjustments continue to impact lead times. 


The market started to turn positive for the first time since September 2022, as carriers announced rate increases around mid-April on some key routes. 

Trans-Pacific spot rates continue to fall. However, there is belief of pending general rate increases upcoming as suggested by several carriers. The improvement in capacity utilization has boosted carriers’ confidence. Shipments pushed forward ahead of the mid-April GRI are expected to drive utilization levels further upwards. 

Asia-Europe spot rates remain steady with minor rebounds expected over the coming weeks. Capacity utilization is reaching a 3 year high on the Asia-North Europe route, while Mediterranean utilization has also recovered and is on par with the last 2 years. 


Whilst the energy crisis did not have a considerable impact to the winter demand as first forecasted, overcapacity continues to impact this region. Shipping lines have implemented service charges to optimise their coverage, differentiate services, and fill up ships with the right ports of call. 

Social movements in France continue to impact French ocean terminals. This is causing delays for cargo flow as well as some re-routing to nearby ports (e.g. Antwerp). These alternative ports are managing the influx thanks to the large amount of capacity in the market. 

North America 

Imports remain soft year-over-year due to inflation and normalizing demand from the largest importers, including retail, furniture, electronics, and home improvement, representing over 50% of U.S. imports. 

Many shippers are still showing high inventory levels and holding off ordering more stock, while seasonal shippers have not yet started to increase their volumes. 

March 2023 U.S. container import volumes increased 6.9% from February 2023, up 4.2% from pre-pandemic March 2019. While this looks positive, consider the fact that March has 3 extra days compared to February, and the Chinese New Year was two weeks later than in 2023. 


U.S. to Oceania 
The market continues to soften, and rates are expected to keep declining as carriers compete for market share. Space continues to be tight on the U.S. East Coast but easing on the U.S. West Coast. 

Port calls to New Zealand for exports from the U.S. West Coast continue on a fortnightly basis, and transshipment service options are increasing. 

The Europe export market remains stable, with space and equipment readily available for dry cargo. Rates are still gradually being reduced by all carriers as supply still outweighs demand. 

Northeast Asia to Oceania continues to be in flux. Carriers are attempting to increase rates, but demand is not at a level to sustain any increases. 

Southeast Asia is in a steady decline due to weakened demand. Shipping lines are amending services, such as rationalizing port calls, to limit space and increase demand. Singapore and Malaysia lines are operating normally without significant delays. 

South Asia, Middle East, and Africa 

Demand out of these regions continue to be soft. India and Bangladesh are steady, however much lower in comparison to last year. Pakistan demand remains down severely. Shipping lines are implementing changes to their services in this area of the world. 

We will continue to evaluate all market options and work with you to provide individual solutions for your business. 

For more details on any of these articles please contact your Henning Harders Key Account Manager. 

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