Hanjin Shipping was a significant player in the global shipping industry. It was the seventh-largest shipping line in terms of capacity and held a market share of 2.9%. It played a key role in US trade, representing nearly 8% of transpacific trade volume for the US market. Nevertheless, the shipping line’s figures had been in the red for four out of the past five years.
There existed warning signs that a potential collapse of Hanjin Line could occur, but many thought the company was too big to fail. However, after its nearly 40-year history, Hanjin Shipping declared bankruptcy on August 31, 2016.
At this time, more than $14 Billion in cargo, ranging from televisions to textiles to spicy kimchi, was stranded at sea and ships were scattered all over the globe at anchor or just outside territorial waters. This number represents 3.2% of the world’s global container capacity.
The “sudden” bankruptcy raised chaos: The beneficial cargo owners neither knew where their cargo was located nor when and how it would be transported further. Dozens of vessels were stranded at sea, not admitted to enter ports to be discharged; others were seized immediately. The fate of over 540.000 containers was suddenly uncertain.
At this point, project44 stepped in: At a click of a button, customers gained an immediate overview over all their containers handled by Hanjin that had not yet reached their destination. Containers that were not moving forward in time were highlighted, to avoid losing sight of shipments and to allow goal-directed actions. Additionally, project44 enabled customers to identify all containers onboard stranded Hanjin vessels, independent of the booked carrier and freight forwarder. Thanks to the AIS vessel tracking data, customers had first-hand knowledge of real-time vessel moves, changed destinations and new arrival times. The close monitoring and immediate notifications in case of schedule changes and other events allowed customers to identify delays and take informed decisions.
Conventional wisdom holds that Hanjin will not be the last international shipping line bankruptcy. To mitigate the impact of such unfortunate events, the following seems advisable:
1. Diversify your freight
As the cargo owner, you should diversify your freight, so your goods are not stuck with one party. With appropriate visibility tools like project44, that consolidate your freight independent from your booking channels, freight forwarders and contracted carriers, you still benefit from a complete and neutral overview over your goods.
2. Put yourself in the best position
Know what is going on with your cargo at any time. Get as much visibility as you can. This will enable you to identify possible bottlenecks and react immediately. Project44’s unique Container Track and Trace service provide you with up-to-date status and schedule information for all your shipments, across all carriers. This will enable you to identify possible bottlenecks and react immediately. For further information please don’t hesitate to get in touch with us.