Worldwide shipping problems will continue for years, warns logistics giant
15 August 2022, 00:04
EV Cargo said freight disruption will take years to fully resolve, further pushing up the the cost of food and goods.
Worldwide shipping woes that have sent prices of food, clothes and goods soaring are set to continue for years, putting further pressure on cash-strapped households and businesses, a logistics giant has warned.
EV Cargo, which handles logistics and supply chains for the likes of supermarkets Asda, Sainsbury’s and high street chain Next, said pressures that have hit shipping prices and availability are set to take years to fully resolve, with fuel and China lockdowns continuing to impact supply chains.
The group cautioned this will intensify the cost of living crisis, compounding inflation pressures as firms are forced to put up prices.
Heath Zarin, founder and chief executive of EV Cargo, said: “It’s going to take a period of years to stabilise and get back to normal.”
“It’s very serious overall and another reason why inflation and higher prices are likely to be with us for longer than anybody would like.”
He added: “There will be ups and downs but there won’t be a massive form of relief from elevated prices.”
The shipping disruption has led to soaring costs and poor container availability for a raft of firms, in particular those that import goods from Asia, where a zero Covid policy has knocked ocean freight.
Staffing issues in ports across the UK, America and worldwide has further compounded the issue.
Fashion retailer Next is among a raft of firms that have suffered rising freight costs over the past year, hiking prices to help combat the pressures.
EV Cargo, the UK’s biggest, privately-held, logistics business, operates road, sea and air freight both in the UK and internationally.
Its international logistics operations manage 200,000 containers of sea freight annually and six million kilograms of air freight monthly.
But it also has a fleet of 20,000 delivery vehicles and a team of 5,000 UK-based, logistics workers, including 2,200 truck drivers.
The group was among those impacted by the UK haulier shortage and has had to increase wages for drivers in a “number of rounds of double-digit increases” to attract and retain staff, according to Mr Zarin.
EV, which also transports goods for firms including Kraft Heinz, Dyson and drinks firm AB InBev, is also facing soaring fuel costs, like its customers, but is hoping to turn to technology and innovation in supply chains to help offset the costs and, in turn, make savings for businesses.
Set up in 2018, EV Cargo was formed by the merger of six of the UK’s biggest logistics companies: Adjuno, Allport Cargo Services, CM Downton, Jigsaw, NFT and Palletforce.
It is aiming to more than double annual revenues from over 1.4 billion US dollars (£1.1 billion) to 3.0 billion US dollars (£2.5 billion) by 2025 through further deals globally and internal growth plans.
