With prospects still murky for the global economy, Maersk Line sets out a clear course for slow steaming. It’s here to stay. It reinforces Maersk Line’s status as most reliable carrier..jpg)
It was easy to argue in favour of slow steaming back when the crisis wreaked havoc in international box shipping. Not only does slow steaming save energy and cut CO2 emissions, it also took boxes out of circulation, thereby stopping rates from tail-spinning. Slow steaming in fact absorbed 4.1% of the global fleet at one point, which in turn helped balance supply and demand, according to Alphaliner.
Now, with the global economy still shaky, but maybe improving, a formula for slow steaming’s future has been found.
“For Maersk Line slow steaming is here to stay because it remains a win-win-win situation. It is better for our customers, better for the environment, and better for our business,” says Eivind Kolding, Maersk Line CEO.
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Going slow = flexibility and reliability
- A ship that reduces speed by 20% will use 40% less fuel, thereby reducing CO2 emissions correspondingly. To maintain the same service frequency and compensate for a lower average speed, 1-2 extra vessels are added per route, or string. Despite the extra vessels, slow steaming has over the last 1½ year reduced Maersk Line’s CO2 emissions by about 7% per container moved.
- Schedule reliability improves because slow speed allows vessels to continuously adjust speed in order to deliver the cargo exactly on time. Maersk Line has a goal of 95% schedule reliability and is, according to Drewry, already well under way. From April to June 2010, Maersk Line had a 77% on-time performance score with the closest competitors ranging from 59% - 64%.
- The concept of slow steaming was originally a hard sell to engine manufacturers. It took off in 2007 and was instrumental for Maersk Line to cut CO2 emissions per container by 12.5% from 2007 to 2009. The goal is to reduce CO2 emissions by 25% in 2020.
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According to a 28 June review by the Liner Management Board in Maersk Line, slow steaming will continue, still with a keen eye for satisfying consumer demand.
“We believe we serve our customers best by steadily improving schedule reliability, by keeping fuel costs down, and by continuing to improve on our carbon footprint. The cost savings will enable us to further invest in innovation and improved service, for example with more efficiency at terminals,” Kolding says.
In other words, while some customers have complained about longer inventory time - in essence with Maersk Line ships as floating warehouses - the analysis is that slow steaming helps prevent bottlenecks on terminals.
Maersk Line customers now know with a higher degree of certainty when their boxes actually arrive, and they can thus plan the forwarding better and more precisely.