Half of Maritime Shipping Companies Expect Recovery
The EU shipping industry has been hardly hit, and maritime shippers are not an exception. At the same time, measures and policies to mitigate the impact of the pandemic have not been implemented in all Member States. This is a critical moment for forwarders throughout Europe, including ship owners, operators, charterers, and shipping companies, all having to make the difficult decision whether to continue operations.
Impact on the Maritime Shipping Industry
In April 2020, a survey was conducted among industry players to assess the impact of the coronavirus crisis on the shipping sector as well as to evaluate the effectiveness of policies and measures to mitigate the impact of the global crisis. Segments covered by the survey include cruise vessels, car carriers, dry bulk, product chemical tanker, and crude oil tanker. Other sectors that are included in the survey are container, general cargo, and passenger, RoPax, and RoRo ferries.
The survey reveals that offshore service vessels, car carriers, cruise ships, and ferries are the hardest hit. Companies face a turnover decline by more than 60 percent. While respondents believe that they are on the way to recovery during the rest of the year, losses have been substantial. The only exception is the tanker sector.
Office personnel and seafarers also lost their jobs in large numbers and while national schemes and policies cover nationals, protective measures do not apply to other nationalities. Another issue is the lack of policies against liquidity problems at the local, regional, and national level. Where measures have been implemented, they either do not apply to the shipping sector or the high costs and administrative obstacles outweigh the potential benefits. This is especially true for segments that have been severely affected, including ferries, car carriers, offshore, and cruise vessels. Job losses in these segments are expected to reach over 60 percent.
Industry experts point to the fact that a number of issues need to be addressed, including seafarers’ health and safety, access to medical care, repatriation of seafarers, and crew changes. In the view of the International Labor Association, all seafarers have the right to social protection and paid sick leave in case of quarantine or infection. Port authorities must ensure access to welfare facilities without prejudice. The organization also announced that reduction of personnel results in increasing levels of fatigue among crew members which puts onboard safety and security at risk. The problem is how to address these issues without putting additional pressure on shipping companies in light of travel bans and quarantines affecting their operations.
Economic Outlook and Planned Investments
More than 50 percent of European logistics companies share the view that they will return to pre-pandemic employment rates. At the same time, they will be forced to either cancel or temporarily postpone investments. This applies to investments to cut air pollutants as 44 percent of respondents said they would cancel investments, 30 percent would cut investments, and 26 percent would proceed as planned.