Navigating the challenges of the shipping and ports industry
Maritime transport is the backbone of international trade and the global economy. Around 85 percent of the global trade volume is transported by sea and handled in ports. Deloitte supports the shipping & ports industry with its team of industry experienced financial advisory, tax, audit, and consulting experts.
Global trade is projected to increase in line with world economic output growth and a rising global population. Shipping and ports are therefore considered growth industries but four main challenges prevail:
Major shipping lenders have withdrawn from the market or are no longer available for mere asset financing. The remaining shipping banks now provide financing on stricter terms and conditions based on lower LTVs at increased margins. Therefore, access to bank financing has become more difficult, and is only partly replaced by alternative sources of capital. To attract these new sources of capital, the ship owners need to focus on their competitive edge, operational excellence, and a high level of transparency on financial performance and ESG topics.
Historically, the shipping industry has been highly fragmented with few large players. Limited access to financing, investments in new technology, increased regulation and economies of scale are driving the consolidation. Developing a M&A strategy, finding the right partner and integration following a successfully transaction are the key challenges of a successful consolidation process.
The global shipping industry is an integral part and at the forefront of international supply chains. The unprecedented disruption caused by COVID-19 has revealed the vulnerability of supply chains and highlighted the need for further investment in digitization and automation, while at the same time limiting cyber security risks.
Reducing emissions is a global imperative and represents a priority for governments, companies, and society at large. In turn, these stakeholders are stepping up their commitments and increasing their efforts to close the gap to net-zero emissions. The International Maritime Organization (IMO) has set a goal of reducing international shipping carbon emissions per transport work by at least 40 percent by 2030, and 70 percent by 2050, compared to the 2008 baseline. The overriding challenge now is not that the industry knows that it has to change, but how to change?
If you are a ship owner, ship manager, port operator, bank or you have any other interest in the shipping & ports industry, our experienced team of financial advisory, tax, audit, and consulting experts have the relevant industry knowledge and functional expertise to support you mastering these challenges.
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