Although Kuehne + Nagel predicts that the expansion in air and ocean volume shown in its Q1 2024 data will continue into the second half of the year, the disruption in the Red Sea will not have a favourable impact on rate levels beyond Q2 2024. While air freight tonnage gained 3.4% to 491,000 tons in the first quarter, Kuehne + Nagel’s ocean freight business handled 1 million TEUs, a rise of 1.5% year over year.
On 20 June 2024, the forwarder announced it is establishing a new logistics platform for the fast-growing French fashion brand, Sézane. This new and flexible operation in Piscataway, New Jersey, will enable Sézane, a long-standing customer of Kuehne+Nagel in France, to offer its end customers an even better service.
“We are incredibly proud to support Sézane with this innovative solution that streamlines their operations, ensuring efficient handling of returns and inventory management,” said Eduardo Razuck, SVP Americas for Kuehne + Nagel Contract Logistics. “Our partnership and the establishment of this new distribution centre in Piscataway represents a significant milestone for Kuehne + Nagel’s Contract Logistics business in the U.S. It underscores our global commitment to the e-commerce business as part of the company’s Roadmap 2026. It also represents the latest advancement in expanding our network to support luxury and fashion e-commerce customers, as well as continually assisting our customers with global expansion.”
Even so, the forwarder is still wary of lower-yielding e-commerce, even though it accounts for the majority of Asian exports.
Arnaud Ameline, Sézane’s COO, added that the company appreciates expanding this partnership and collaboration with Kuehne + Nagel. “A huge ‘merci’ to the Kuehne + Nagel team for working quickly to bring us this custom solution that will help us in managing our e-commerce operations in America. We have built this business from selling first via an eBay vintage shop to now being a global, direct-to-consumer fashion label. With Kuehne + Nagel’s support, we are able to stay true to our brand, which focuses on community, value, and a great customer experience – from end to end.”
The spike in market demand in the first few months of the year, according to Yikun Shao, head of North America supply chain at B2B online marketplace Alibaba.com, was caused by high e-commerce volumes and recent interruptions affecting ocean shipping routes, especially the Red Sea.
Dimerco, a Taiwan-based forwarder, stated in a market report that Chinese e-commerce giants Temu and Shein were mostly responsible for the massive e-commerce demand from North Asia to the United States and Europe. The air freight market may be reaping an e-commerce-driven boom, but the industry is on the verge of a longer-term capacity constraint and might struggle to absorb rising volumes.
Author: Shruti Sasidharan
Source: Ti Insights
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