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Customer Advisory COVID-19

Since the COVID-19 virus has spread, we have extended our COVID-19 customer update. We have compiled and aggregated facts and figures across all business areas as well as covering all regions. Please continue to be engaged with your account managers on your latest plans, prices and projections. We continue to make every effort to support your business.


Global Market Updates

Demand for vaccines is strongly increasing week by week as emergency approvals have recently been granted by national regulatory authorities for various COVID-19 vaccines and as further approvals are currently being evaluated and processed. The global demand and capacity requested is yet limited to certain trade lanes but expected to increase shortly throughout the first half of 2021. Especially during the second half of 2021, a strong increase in production and consequently global demand for the vaccine distribution by airfreight is necessary. This increase will lead to a situation in which all supply chain partners are required to collaborate closely to mitigate potential negative impacts or disruptions during transportation and distribution.

The airfreight market has been used to transport vaccines between +2 to +8°C, however has not yet been exposed to a situation where a demand for a global distribution of a vaccine requires the product to be kept deep frozen. Operationally, the major impact as already experienced in the initial weeks is expected in the final mile distribution due to the temperature requirements of a COVID-19 vaccine. Some of the distribution is expected to be resolved through a domestic or road freight distribution network as key pharmaceutical companies are using multiple production sites mainly in the USA, Europe and Asia.

For successful distribution, storage, repacking, and administration of a COVID-19 vaccine, additional medical supplies will be needed – including needles, syringes, alcohol prep pads, surgical masks and face shields, gloves, mixing kits and additional PPE. Being part of our integrated end-to-end healthcare services DB SCHENKERlife+ with licensed and regulated facilities, alongside dedicated and qualified staff, we offer warehousing services to handle all medical devices.

  • Global

(Jan 05, 2021) - The strong peak season did not yet come to an end as overall demand in the market is still at peak levels. The demand is also not expected to decrease significantly in the coming weeks as shippers convert ocean to air shipments due to the on-going challenging situation in the global ocean freight market. This has led to increasing pressure in the already tight airfreight market and is expected to continue if not even increase. The initial major impact has been seen in the Westbound market from Asia Pacific and especially China Outbound. However, the situation in Europe for the European exports can also quickly change as container shortage and equipment continues to be a major impact in the global supply chains.

With increasing COVID-19 cases across many countries, they also started to increase current regulations and quarantine measures to mitigate the current situation. On one side, this can lead to delays in the European distribution of airfreight shipments soon due to major operations and capacity being connected to the larger HUBs in Europe. On the other side, some delays are also expected with the new Brexit situation and the cross-border traffic from mainland Europe to the UK. These restrictions and challenges could quickly remain applicable for the next 2 - 3 months depending on the pandemic situation in the major countries across all continents, in particular in Europe and North America.

Our console charter flight schedule now includes the following flight operations:

→ Europe – China – Europe: 4 flights per week (B747-400F)
→ Hongkong – Europe: 2 flights per week (B747-400F)
→ China – USA: 3 flights per week (B747-400F)
→ Europe – USA – Europe: 4 flights per week (B747-400F)
→ Europe – India – Europe: 1 flight per week (B747-400F)

  • Europe 

(Jan 05, 2021) - All offices remain in full operation with access to terminal handling and ground transportation. All our European hubs deliver import and receive export freight with no backlogs recorded towards the weekend. Operationally, our linehauls to and from the hubs are running as scheduled. In some areas, our cross-border trucks might experience some minor delays.

→ Please get in touch with your DB Schenker Account Manager for more information.

  • Asia Pacific 

(Jan 05, 2021) - There are no updates on any impacted operations due to COVID-19, with status largely remaining unchanged.

Recent resurgent infection waves in the region underscore the continued risk on operations and the vigilance necessary to cope with the ever-present COVID-19 situation.

Though tight controls remain in some countries across APAC, our air freight operations remain available to support customer needs. Delays will be expected in customs clearance and transportation. Alternatives to move / transport cargo via other gateways / routes are being established where necessary. Customers may contact the respective DB Schenker representatives for support or solutions if required.

Capacity is expected to remain volatile. We remain vigilant in monitoring the situation to mitigate events with potential impact to operations.

  • Middle East/Africa 

(Jan 05, 2021) - Overall, the air freight operations in the countries remain uninterrupted and we continue to serve our customers. Only international passenger flights have been suspended in Saudi Arabia and Oman until further notice.

Situation

Country

No operational restrictions for air cargo business         

Angola, Bahrain, Egypt, Kenya, Namibia, Mozambique, Oman, Qatar, South Africa, Saudi Arabia, UAE

→ Please get in touch with your DB Schenker Account Manager for more information.

  • Americas 

(Jan 05, 2021) - Entering the new year there is a continued strain on capacity to varying degrees by trade lane. In addition, airport terminals are at times running behind in transitioning cargo creating further challenges. Especially the ground handling situation at key major airport such as Chicago O’Hare, New York and Los Angeles has led to heavy delays (2 - 4 days recovery) in the import ground handling process and workforce constraints due to COVID-19 impacts.

The situation has improved, but DB Schenker continues to closely monitor the situation to mitigate any impacts for our customers and inform you immediately in case of any change. DB Schenker flight operations and part charters both transatlantic and transpacific are providing secure capacity for our customers, and our airport-based offices are providing the necessary coordination to provide the fastest release of cargo possible. As well DB Schenker is growing its own flight operations for 2021, with additional export offering to Europe and now to Asia with heavy utilization of our new on ramp facility at the Rockford airport next to Chicago.

Situation by trade lane is as follows:

USA – Europe

→ Market demand is moderate to strong. Further charter flights have been launched with the Global Flight Operations Program to provide additional air cargo capacity to Europe.

→ These flights are connecting Atlanta and Chicago with Frankfurt, Germany and other surrounding Central European markets. They offer DB Schenker customers a stable access to capacity in what continues to be a volatile market situation.

USA – Asia (excluding China)

→ Capacity has tightened on most trade-lanes as a 4th quarter peak has materialized with the strongest capacity challenges remaining with movements to Australia, Singapore and India. DB Schenker’s strong ‘Part Charter’ capacity in place from ORD to destinations in Australia, and flight operations via the DB Schenker Euro Hub from FRA – BOM are supporting DB Schenker customer demands to these destinations.

USA (exports to) – China

→ No capacity constraints to key destinations in China. Market demand is moderate with the market supported by the large amount of inbound flight operations and charters that support capacity on the return leg to China.

USA – Latin Am / Latin Am to Europe and APAC

→ Intra-Americas: Market demand has grown significantly in the 4th quarter and is continuing into 2021, with access to capacity becoming tight as freighter carriers are reducing scheduled flights, and passenger flights continue to be well below pre-COVID-19 levels. This situation is affecting all countries in central and South America with cargo movements Intra-Latin America as well as into the USA and Europe and beyond.

USA / Latin Am to Middle East / Africa

→ South Africa with continued strong market demand and shortage of capacity.

  • Global

(Jan 05, 2021) – Market demand ex Asia continues to massively exceed the supply; this affects all trades including smaller Intra Far East lanes. Subsequently, equipment remains very tight. Carriers push for utmost empty positioning activities ex Europe and North America back to Asia, leading also to drying equipment pools in these regions. Several global carriers are expecting new equipment to be released in Asia over the next weeks to ease the current bottleneck. However, there is no blank sailing scheduled over the Chinese New Year and the booking situation remains very strong throughout Q1 / 2021. The effect of the new equipment may not be visible. The carrier position remains very strong to execute strict yield management and prioritize equipment release, space and uplift accordingly.

Career Capacity Development 1-12/2020

Capacity ex Asia runs at fullest utilization and with massive roll over pools for several carriers. Market is expected to produce full ships beyond the Chinese New Year. Given this positive momentum, industry analysts have revised their earlier more negative anticipation of the ocean freight to a more moderate negative 4% volume growth for 2020, with an outlook of a growth in 2021 of about 4 to 6%.

Import free time in all markets is generally cut down to zero with effect of January 2021.

The current circumstances make it very important for our customers to plan volume forecast (we advise 4 to 8 weeks in advance) and be flexible to re-route cargo (for congested destinations).

Career Capacity Development 1-12/2020

With volumes improving further on all export trades ex EU, the situation for exports ex Europe is getting tighter as equipment availability becomes more critical. Carriers have started to set up resp increase various surcharges. The situation is expected to impact also ocean rates during Q1 / 2021.

Please expect the situation on all trades subject to continuous changes.

With an uncertain outlook on vessel utilizations and partly huge impacts on port terminals, we need to prepare for changing schedules and transit times (due to slow steaming, port omissions or additional port inclusions as a result of service mergers), sudden / unexpected delays in uplift, increased bottlenecks of equipment availability, inconsistent departures and sudden surcharges possibly resulting in higher costs for the supply chain.

Our experts in Ocean will support and guide for

→ DB SchenkerOcean priority product on all main trades which guarantees loading within a fixed window.
→ DB SchenkerOcean offers for alternate routing possibilities to ensure cargo is lifted from port of loading.
→ Volume forecast and allocation planning: We have access to volumes on all alliances and support volumes planning through consultation services (allocation match based on customer forecast). Under progress: volume prediction per vertical.
→ Cargo storage options or cargo in transit options to avoid costly tariffs.

Contact your DB Schenker Account Manager regarding Personal Protective Equipment services ex China Europe.

  • Europe 

(Jan 05, 2021) - All European Ocean Freight Branches are fully functioning operationally.

  • Asia Pacific 

(Jan 05, 2021) - Notwithstanding the severe market situation on rates and capacity as highlighted by Global Ocean, there are no significant COVID-19 impacted operations, as status remains unchanged.

Though resurging COVID-19 infections are evident in some countries across APAC, our Ocean operations remain available to support customer needs. Delays could be expected in customs clearance and transportation.

→ Alternatives to move / transport cargo via other gateways / routes are being established. Customers may contact the respective DB Schenker representatives for support or solutions should it be required.

  • Middle East/Africa 

(Jan 05, 2021) - Besides the port closure in Kuwait, DB Schenker is fully operational and available to manage the current demand from customers even though an equipment shortage has been seen in the region.

→ Please get in touch with your DB Schenker Account Manager for the latest rates.

  • Americas 

(Jan 05, 2021) - On the exports ex NORAM, it is worthwhile to mention that especially to Asia, the vessel utilization remains strong with no inflation of market rates expected. Void sailings and service suspensions causing severe shortage of space on all North American gateways resulting in high vessel utilization factors across the board. Roll-overs and yield management are being applied by carriers. Extra loaders deployed and services being reinstated on ad-hoc basis. Asia to North America is peaking further and bookings Asia to South America have come up massively during the past two weeks. We continue to monitor the situation.

  • Global

(Jan 05, 2021) - Europe Land is fully operational and available for business, managing existing constraints re-established in many European countries. Asia gives a heterogeneous picture with most countries fully operational and available for business while a few countries (such as India) are facing challenges, however operating. Asia Landbridge (China – South East Asia) as well as Eurasia Landbridge (China – Europe Train) are fully operating, although facing congestions. Land operations in the Americas are also showing constraints, but still working close to normal.

  • Europe 

(Jan 05, 2021) - Travel bans for truck drivers entering Mainland Europe from UK have been lifted and a procedure of COVID-19 testing has been put in place (authorised negative COVID-19 test, that has been conducted within the 72-hour period before their departure). Update of UK Government from January 4, 2021 states the following: “Thanks to the support of the army, the backlog of HGVs in Kent has been cleared and hauliers making their way to Dover and the Eurotunnel continue to be tested swiftly and safely.” Nevertheless, with increasing trade volumes and customs formalities at the border due to BREXIT, the risk of potential delays at the UK border is increasing. Latest updates on channel traffic situation can be found here: DB Schenker status update

General restrictions to contain the COVID-19 pandemic are continuing to be in place in several European countries and are in parts directly or indirectly affecting the transportation of goods. For any potential cases of disruptive conditions, we follow our pre-defined contingency plans to ensure flows of cargo as much as possible. In addition, we are adapting our transport service offerings daily to the needs of our customers.

Some receivers continue to have limited operations and we ask all shippers to check the delivery possibility with the consignee to avoid cost for storage or return shipments.

Are you up-scaling or down-scaling your business activity in response to the changing market environment? DB Schenker Landtransport is your partner with one of the strongest and most resilient networks across 40 countries in Europe. Moreover, with our digital channels like connect4Land we offer a 24/7 entry point to our transport services, easy to use from everywhere, every time – Click. Ship. Done.

Europe Land Transport Heatmap Graphic

  • Asia Pacific 

(Jan 05, 2021) Our Domestic Land product continues unabated to provide our regular high level of service.

Our Asia Landbridge FTL / LTL road service still encounters intermittent reactionary border closures. Border congestion due to high demand can add between 1 and 3 days to Asia Landbridge. A global demand for containers due to Ocean and Air capacity constraints has put significant pressure on road assets across the region. DB Schenker staff at Asia Landbridge border offices ensure lead-times are minimized and service levels maintained through “triage” prioritization. Additional labor and associated domicile costs are still required to strategically avoid lengthy quarantine periods for our international drivers.

Our Domestic and International road services continue to meet the high market demand and are strategically positioned to meet the forecast demand spike associated with ongoing reduced Ocean freight and Airfreight capacity. However, customers are strongly urged to coordinate any volume spikes with their DB Schenker Account Manager as early as possible.

Congestion levels continue to fluctuate on our Eurasia service for Rail and Road. There are delays >10 days at CN / KZ and CN / MN; 3 - 7 days at CN/RU border and <2 days at BY / PL (Mala) – refer to picture 1.

Picture 1 – Westbound ETD delay and border congestion delay risks Table showing the Westbound ETD delay and border congestion delay risks Westbound container stocks are running low and may lead to delays in the near future.

Christmas vacation will impact rail freight forwarding up to January 7, 2021.

We therefore recommend checking estimated lead-times with your DB Schenker Account Manager.

  • Middle East/Africa 

(Jan 05, 2021) - Land transportation may be delayed in some countries due to additional checking. In some parts of the GCC, cargo movement has been restricted to food and essential items.

→ Please get in touch with your DB Schenker Account Manager for more details.

  • Americas

(Jan 05, 2021) -

→  USA: USA still experiencing tight capacity in certain areas due to COVID-19 impacts on carrier staff. Anticipate capacity to be tight throughout the remainder of the year, as we continue into the peak season.
→  Brazil: Market is running in normal conditions.
→  Mexico: 100% fully operational. Although finding capacity at Ciudad Juarez for North Bound shipments can be a challenge.
→  Canada: Toronto and Peel regions are on lockdown effective for 28 days. Other close by regions have moved to ‘red status’ which allows everything to be open, but with very strict limitations. Restaurants and retail are shut (except for curbside service). Department, hardware, grocery stores remain open as essential.

  • Global

(Jan 05, 2021) - Our operations and customer services remain stable. No change in prioritizing protection of our staff and keeping our customers’ businesses running. With dedicated guidelines and preventive measures, we keep up our constant and short-term customer support. While supporting companies and institutions around the globe with handling of PPE and medical devices for successful distribution and administration of a COVID-19 vaccines, we keep up our offering towards our customers:

→ In case you need temporary space, reach out to your DB Schenker Account Manager or local contact person!

  • Europe 

(Jan 05, 2021) - All sites in our operations in Europe currently remain fully operational with precautionary measures in place for the health of workers.

  • Asia Pacific 

(Jan 05, 2021) - There is no significant change in status for APAC countries generally from previous updates. Tight controls remain in several APAC countries due to resurgent outbreaks. We remain vigilant in monitoring the situation, to mitigate events with potential impact to operations.

Due to extension of movement restrictions, some delays may be expected, albeit with no significant impact to our operational status.

→  For India, there have been no significant operational updates. Please refer to our India website for detailed information via download.
→  For Greater China, no change in operational status, despite local outbreaks reported and being contained in some cities.

While governmental imposed restrictions in APAC countries continue at varying levels, our service levels so far are maintained with our CL operations available to support customer needs.

Delays may be expected due to availability of workforce and enhanced strictly enforced hygiene and monitoring SOPs. Customers may contact the respective DB Schenker representatives for further support if necessary.

  • Middle East/Africa 

(Jan 05, 2021) - All DB Schenker contract logistics facilities in MEA are operational as per the appropriate health and safety standards and other regulations levied by the local government.

  • Americas 

(Jan 05, 2021) - While observing increasing cases of COVID-19 infections across the region, our warehouses continue to operate, with precautionary measures in place for the health of our people and hence keeping up our customer services.

→  USA: All operations in the USA remain operational with precautionary measures in place for the health of our people and delivery of services to our clients. We are seeing increasing cases of COVID-19 in the USA and remain very robust in our safety measures and protocols.
→  Mexico: COVID-19 numbers are increasing in Mexico. Some states do require partial shut downs of private life and economy in particular on weekends. We are doing everything possible to minimize the impact to our personnel and facilities.
→  Canada: Expanded lock down measures affect non-essential retail in the Province of Ontario. All Contract Logistics sites in Canada remain operational with health and safety measures in place for the safety of our associates and continued service.


DB Schenker Organizational Update

DB Schenker is closely monitoring the COVID-19 situation. With precautionary measures in place, we are aiming to maintain full operability across all DB Schenker operations. In our offices across all continents, we have taken action to enable as many employees as possible to work from home to support the social distancing guidelines put in place by public authorities or the government in many countries. Our first priority is the health of our employees and partners. We adhere to the recommendations of health experts, especially WHO, related to, for example, hygiene precautions.

The next update will be sent on November 10th (or earlier should there be significant developments).

Please visit our website www.dbschenker.com or your local DB Schenker website for ongoing updates and additional information.

 
Thank you for your patience and support.
DB Schenker COVID-19 Customer Advisory Team


Disclaimer: We have used our utmost care in providing the information above. While the information above has been provided to the best of our knowledge and ability, the DB Schenker Group does not assume any liabilities arising from this information or the use thereof.