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General Market Situation.
Supply chains around the world are feeling the effects of the unprecedented global coronavirus outbreak. Since the first major disruption at the end of January, almost every aspect of international transport has been affected. In view of the countermeasures already taken in Europe and the USA, it can be assumed that a massive disruption of the logistics infrastructure and thus of the global flow of goods will continue for at least several weeks.
While the situation in China is gradually improving and, according to current information, production capacities are said to have already reached a level of approximately 75% again, we are still experiencing a large-scale shutdown in Europe and North America due to the continued rapid spread of the infections and the associated government restrictions.
Be prepared for a massive imbalance between supply and demand, which will be accompanied by higher, highly volatile freight rates. At present, we are therefore unable to make any serious or binding predictions regarding rate levels and planned delivery times. We have to examine each case individually.
We work closely with our strategic partners, airlines & shipowners, in order to always have full transparency about the situation and thus to meet the needs and requirements of our customers. In addition to the greatly reduced routes and freighter connections, we also make use of short-term charter flight capacities where available.
Austria's most important cargo airports, Vienna and Linz, have switched their infrastructures to "emergency operation" due to severely limited passenger flights. Cargo handling will continue to take place, but longer handling times than usual are to be expected due to the more difficult conditions. All other airports in the provinces have completely stopped handling cargo until further notice.
Austrian Airlines is even suspending all flight operations from March, 19th, until May, 31st.
The travel restrictions between the USA and Europe have led to massive disruptions in transatlantic air cargo traffic. Passenger air traffic will also be completely suspended, so that the remaining freighter connections will remain the most important airfreight option in the coming weeks. This historical restriction is accompanied by considerable rate increases in connection with longer transit times or delays that are generally only controllable to a limited extent.
In contrast, Chinese export volumes are once again growing strongly and will continue to encounter a sharp reduction in cargo capacity in the coming weeks, as airlines in particular are suspending the schedules of their passenger aircraft (which account for a significant proportion of normal capacity) until the end of April.
Due to the low volume of imports from China in recent weeks, there is a massive shortage of empty container equipment in the USA and Europe. This lack of empty containers in turn makes it more difficult to export by sea freight from Europe over the next few weeks until the balance is restored. While the situation in China is gradually stabilizing in this area as well, we are facing the same problems in Europe as we experienced in China a few weeks ago. Bottlenecks in driver personnel as well as in the ports and inland terminals are to be expected as a result.
In Austria (as of April, 8th) all terminals are open for combined transport. Due to the expected volumes - especially for imports - all operators have already suspended about 30% of the train capacities from/to the ports. Further reductions are planned for the coming weeks.
Additionally, the unclear situation in exports, as many manufacturing companies in Austria will have only limited operations in the coming weeks and months due to early company holidays and short-time working.
It is therefore currently not possible to determine how much volume will be available in Austrian exports in the coming weeks.
Reliable forecasts have never been as critical as in our current situation. Airlines need accurate forecasts in order to plan their capacities appropriately. With limited cargo space worldwide and new restrictions announced daily, it is essential to plan ahead.
Please take the time to carefully and regularly review your supply chain needs for the coming weeks and months. We are available to support you at any time in developing a transport plan that is individually tailored to your short-term needs and the current conditions.
ACS Logistics is fully operational for its customers and we are in constant contact with our global partners. We have taken measures to react quickly to the rapidly changing global logistics situation and to serve your transport needs as efficiently as possible.
Sincerely,
Thomas Sticht, Ulrich Hartwig, Gerald Kleeberger
Management
See also: Covid‑19 ACSL Statement
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