As container shipping supply congestion continues to worsen and rates soar US retailer Home Depot has taken the radical step of hiring its own boxship.
The move to charter in a containership solely for its own use was revealed by the retailer on CNBC as part of measures it is taking to beat supply chain congestion and equipment shortages.
“We have a ship that’s solely going to be ours and it’s just going to go back and forth with 100% dedicated to Home Depot,” President and Chief Operating Officer of Home Depot, Ted Decker said in an interview with CNBC.
The ship is start operating from the retailer next month, and no further details of the ship or the charter were made available.
However, it illustrates how serious the situation has become that a shipper is going to such lengths to guarantee its shipments.
Container shipping has been hit by successive shortages of equipment, congestion at US West Coast ports, and now serious delays at South China ports due to Covid-19 prevention measures and restrictions.
The shippers of larger, relatively lower value goods have been hardest hit by space shortages and freight rate increases. Home Depot sells generally large items such home renovation materials, garden furniture, and power tools.
A recent report by analysts Sea Intelligence highlighted that for assembled furniture the freight rate now accounts for up to 62% of the retail value of the goods, while for large appliances now command a spot rate up to 41% of the cargo value, and for small appliances the freight accounts for up to 27% of the retail value.
For goods such as power tools Home Depot has on occasions recently turned to using air freight Decker said in the interview.
Source: Seatrade Maritime