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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

  • Global

(Aug 4, 2020) - Market demand has increased in July and continues this path in the first week of August. The increase in demand is partially caused by increasing volumes across all sectors and industries as well as selective increases in PPE demand for required supply in COVID-19 impacted countries. This takes effect as airlines recently started to bring aircrafts into maintenance due to high utilization of the aircrafts in the first half of 2020. The maintenance checks for the aircrafts are leading to an overall reduction in capacity supply in the market as freighter capacity remains the key share of global capacity during COVID-19. Passenger aircraft flights are only slowly returning to the market and not expected to fully recover before 2022 / 2023 as passenger demand for international flights remains low. Trade lanes that were previously served through passenger belly capacity are further impacted due to a shift of freighter flights and capacity to support the demand on the major trade lanes.

➢ We kindly request for your support on a close collaboration to ensure we plan for a smooth and peak season and work hand in hand between your local DB Schenker team and yourself during this critical time to keep supply chains stable. It is our ambition to be your provider of choice for your airfreight transportation and to offer you a capacity situation that enables your business to be successful.

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

➢ Europe – China – Europe: 3 flights per week (B747-400F)
➢ Hongkong – Europe: 2 flights per week (B747-400F)
➢ China – USA: 3 flights per week (B747-400F)
➢ Europe – USA – Europe: 3 flights per week (MD11F and B747-400F)
➢ USA – Australia: 1 flight per week (B777F)
➢ Europe – India – Europe: 1 flight per week (B747-400F)

  • Europe 

(Aug 4, 2020) - 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.

Airfreight export market volumes are slightly lower, but import is still very stable on a high level. China imports go very strong at continuously all-time highs due to an ongoing strong demand in medical supplies, protective gears, and face masks which DB Schenker continues to support with utmost priority.

➢ Contact your local DB Schenker Account Manager on priority routes for PPE.

  • Asia Pacific 

(Aug 4, 2020) - Australia, State of Victoria is under Stage 4 (highest level) lockdown in the city (Stage 3 restrictions for non-essential movement for rest of Victoria) w.e.f. midnight Aug 5. We have been advised that Qantas Melbourne Air Freight Terminal may experience delays with potential temporary closures possibly impacting freight movements over the coming days. In the meantime, as a counter measure, we have advised our network and stand ready to route Melbourne bound freight via other terminals in Sydney.

The Philippines authorities have reinstated Modified Enhanced Community Quarantine (MECQ) measures in the National Capital Region (NCR), as well as Bulacan, Cavite, Laguna and Rizal provinces from August 4 to 18. Similar reinstatement / extension of restrictions is also seen in Indonesia, several prefectures in Japan and some parts of Vietnam. Movement restrictions generally may cause some delays, albeit no significant impact to our operational status.

Though resurging COVID-19 infections are evident in some countries across APAC, our air freight operations remain stable and available to support customer needs. Delays are expected in customs clearance and transportation as lockdowns in some countries affect availability of workforce, including ports, airports, etc. Alternatives to move / transport cargo via other gateways / routes are established. Customers may contact the respective DB Schenker representatives for support or solutions should it be required.

APAC countries are opening with the majority allowing manufacturing activities. Congestion in Greater China remains, albeit improving gradually. Capacity is expected to remain volatile.

More countries are easing up their restrictions allowing for restarting.

➢ On India charters, plans are in place and timed for when the market opens. Within India, DB Schenker is also able to support land transportation across borders.

➢ Demand for ex China is stabilizing. The backlog at all China airports is requiring minimum 48 hours advance notice for tendering in of cargo.

We have put additional charter programs (such as for Intra-Asia SG to IN and others) in place. Do get in touch with your DB Schenker Account Managers for further details.

  • Middle East/Africa 

(Aug 4, 2020) - Overall, the air freight operations in the countries remain uninterrupted even as Oman, Kenya, and South Africa slip into partial curfew. We continue to serve our customers. Our regional and global preferred carriers are seen to gradually increase the frequency of passenger cargo flights. For more information, get in touch with your DB Schenker Account Manager.

Situation

Country

No operational restrictions for air cargo business

Qatar, Kenya, Oman, South Africa, Bahrain, Saudi Arabia, UAE, Egypt

Restrictions for operational air cargo business

➢ Please contact your DB Schenker Account Manager for more information on additional routes.

  • Americas 

(Aug 4, 2020) - USA – China
➢ Sufficient capacity for USA exports to key destinations in China. Large number inbound scheduled freighter flights and charters continue supporting USA exports providing capacity to meet demands on the return leg.

➢ Rate levels are relatively low but remain above pre-COVID-19 levels.

USA – Asia (excluding China)

➢ Destinations with tight capacity continue to be Australia and India from all USA origins. Korea and Singapore with tight capacity and some backlogs from the USA eastern gateway cities of JFK, ATL and MIA. Market pricing moderating from prior highs, but still well above pre-COVID-19 levels.

➢ Flight operations via the DB Schenker Euro Hub in FRA to BOM and Part Charter capacity from ORD – SYD are supporting these high demand destinations.

USA – Europe

➢ Market demand is moderate with sufficient capacity to avoid backlogs. Market pricing has moved downwards, but as countries begin to reopen, the possibilities of renewed demand with accompanying upward pricing pressures is possible.
➢ DB Schenker maintaining round trip freighter Flight Operations: 3 x week ex ORD & ATL to FRA and back.

USA – Latin Am / Latin Am to Europe and APAC

➢ Intra-Americas: Market demand is moderate with sufficient freighter capacity to most destinations from the USA to Latin Am. Exceptions being to and from Peru and Bolivia where capacity is tight. Market pricing trending higher for North America to Brazil, Peru, Bolivia, Argentina and most Central American countries.
➢ South America exports to other regions: Sufficient capacity but market pricing trending much higher. Some passenger flights are returning, however far from previous frequencies and not providing much additional capacity. The principle carriers for the region have declared chapter 11 bankruptcy (re-organizing). Services continue but with some minor flight scheduling disruptions / delays.

  • Global

(Aug 4, 2020) - After half a year on reduced capacity, main trunk routes Asia to NORAM but also Asia to North Europe are running at 2019 capacity levels and in some weeks even surpassing the 2019 levels. Together with the spike in volumes, several extra loaders have been announced for deployment for the month of August and partially September. We expect that equipment in the weeks ahead will become tight while market rates are holding up strongly and are expected to climb up further in selected trades, achieving record levels. Already today, we note a serious shortage of 40’hc equipment in main ports Asia. Good forecast planning is essential to overcome this bottleneck. The current liftings and outlook for the next four weeks look strong for the trunk routes, i.e. Asia to Europe, Asia to NORAM, Europe to Far East. Liftings into Middle East and Africa have recovered, but exports into Latam are still on a large decline. With all stakeholders in the supply chain, the unpredictability and constant changes of the last weeks have underlined the need to stay flexible and to be able to adapt at any time. It is not a surprise that carriers announce that their booking acceptance will not go beyond six weeks due to possible future changes.

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

With massive vessel withdrawals, 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, less frequent 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.
➢ Various DB SchenkerOcean delay in transit options (a. stopping of cargo in a t / s port, b. using own or contracted warehouses and store goods accordingly), this reduces actual cost in the ports (costly storage) and helps ports to prevent from being congested and thus ensures moves at quay without waiting time for truckers.
➢ DB SchenkerOcean offer for “slow boat – fast boat” possibilities if delay in transit is not an option (e.g. with sailings around Cape of Good Hope).
➢ 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.

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

  • Europe 

(Aug 4, 2020) - On trades to the West, the utilization to North America has improved to over 90%, however LATAM destinations are in decline. It is expected that carriers will take additional actions on curtailing the capacity.

On exports ex Europe to the East, carriers still report strong booking situations with only limited shortfalls. Especially commodity volumes are still going strong (logs, chemicals). Equipment availability becomes a larger concern due to an upcoming 25 - 40% reduction of inbound flows plus expected longer usage of the equipment.

All European Ocean Freight Branches are fully functioning operationally.

  • Asia Pacific 

(Jul 21, 2020) - Though resurging COVID-19 infections are evident in some countries across APAC, our Ocean operations remain stable and available to support customer needs. Delays are expected in customs clearance and transportation as lockdowns in some countries affect availability of workforce, including ports, airports, etc.

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

Ex China, Ocean Freight is stabilizing, and blank sailings are reduced but still impacting all trades. Whilst market demand to Middle East remains weak, some slow uptrends can be monitored on trades to ISC and Oceania. An increase in demand for the express ocean services on the trans-Pacific can be monitored.

For all APAC countries, customers are encouraged to use seaway bills to avoid reliance on original bill of lading as courier companies may not deliver timely in the coming weeks and most companies, including DB Schenker, are operating with working from home based on health concerns and strict government regulations.

  • Middle East/Africa 

(Aug 4, 2020) - Intra Middle East trade is seen to pick up with increase in market demand predicted in Q4.

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

Our Ocean Freight offices in the countries continue to serve customers as logistics and supply chains are considered business critical as per local government directives.

  • Americas 

(Aug 4, 2020) - On the exports ex NORAM it is worthwhile to mention that especially to Asia the vessel utilization remains strong with no inflation of 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.

In LATAM, the expectation stays that market will rebound for Q3 with better performance. YTD June 2020 Inbound Volume market declined by -30% while Exports declined by -15%, however, reefer market grew by 1% YTD June 2020, while the remaining verticals are down from -12 to -30%. Carriers are still evaluating the blank sailings implementation for the 2nd half of August. ECSA to Europe & Asia running at 100% vessel utilization, due to capacity management thru blank sailings, creating capacity constrains (Asia & USA lanes). Much of the cargo to Asia is routed via Europe due to the lack of Asian services.

  • Global

(Aug 4, 2020) - Europe Land is fully operational and available for business, managing existing constraints. 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. Land operations in the Americas are also showing constraints, but still working close to normal.

  • Europe 

(Aug 4, 2020) - Restrictions directly or indirectly affecting the transportation of goods are largely lifted in an increasing number of European countries. For any potential cases of disruptive conditions, we follow our pre-defined contingency plans to ensure flows of cargo as much as possible.

During the last weeks we had suspended the money back guarantee of our System Premium product due to the unpredictable and volatile circumstances. We are happy to announce that with immediate effect we will restore the money back guarantee for System Premium shipments. Delivering superior quality for our customers was always and will remain the highest priority for us – for that reason the restoring of the money back guarantee was of utmost importance for us.

With increasing economic activity in many European countries, we are adapting our transport service offerings daily to the needs of our customers. Are you restarting or expanding your international business activities? DB Schenker Land is your partner with the strongest and most resilient network across 38 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.

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.

  • Asia Pacific 

(Aug 4, 2020) - Asia remains at different levels regarding the COVID-19 crisis but is being heavily supported by our domestic road freight, Asia road International (Asia Landbridge), and Asia-Europe train transport (Eurasia Landbridge). Congestion at Asia borders are easing gradually, albeit still being monitored closely.

➢ Eurasia Landbridge

Eurasia Landbridge has doubled the volume capacity since March 2020 owing to the reliable lead time during COVID-19.

Rail services include LCL, FCL, single container, company train, and block train services on a weekly basis, both eastbound and westbound. Strong road networks and services at origin and destination ends enable seamless end-to-end services.

Lead time terminal to terminal is 16 - 18 days westbound, 18 - 20 days eastbound. Also, we launched a weekly block train Xian to Rostock with a lead time of 12 days.

➢ Asia Landbridge

Our Asia Landbridge has also doubled volume capacity since March 2020 with a compelling lead time and low freight cost.

Asia Landbridge also supports Air and Ocean connections by delivering the cargo to the nearest gateway with capacity, providing in-transit change of mode services when destination airspace is restricted or air capacity limited.

Both FTL and LTL services are available within the Asia continent, with daily departures for FTL complimented with our LTL service which has three departures southbound and twice weekly northbound.

➢ Domestic Land

Operating in 17 countries across Asia, our offered volumes and operations are back to normal. We are constantly tailoring our services to enable customers to meet the changing demand from the current erratic activity spike; recently we have developed a contactless POD signing process to facilitate a safe cargo handover.

  • Middle East/Africa 

(Aug 4, 2020) - International GCC land border connecting Saudi Arabia to other countries has been opened for land transportation / land freight movement with limited operations.

  • Americas

(Aug 4, 2020)  -

➢ Mexico: 100% fully operational. Still having delays at border (dispatching 48 hrs).

➢ United States: Truckload seeing prices and capacity challenges along border, Houston and California.

➢ Brazil: Cross Borders between Brazil and other countries continuous working in a reduced time, and the border between Brazil and Bolivia is closed.

  • Global

(Aug 4, 2020) - Global situation is diverse, increase of restrictions especially in APAC. In other regions we observe business getting back to regular performance levels and beyond. Hence, we keep up our customer support and offer:

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

Regarding our global operations, we are committed to safety and do prioritize protection of our staff and keeping our customers’ businesses running. BCPs are in place and monitored around the world with dedicated guidelines and preventive measures.

  • Europe 

(Aug 4, 2020) - All sites in our operations in Europe currently remain fully operational with precautionary measures in place for the health of workers.

  • Asia Pacific 

(Aug 4, 2020) - Australia, State of Victoria is under Stage 4 (highest level) lockdown in the city (Stage 3 restrictions for non-essential movement for rest of Victoria) w.e.f. midnight Aug 5. Due to reinstatement of movement restrictions, delays are expected with potential temporary closures possibly impacting operations for non-essential sectors over the coming days.

The Philippines authorities have reinstated Modified Enhanced Community Quarantine (MECQ) measures in the National Capital Region (NCR), as well as Bulacan, Cavite, Laguna and Rizal provinces, from August 4 to 18. Similar reinstatement / extension of restrictions is also seen in Indonesia, several prefectures in Japan and some parts of Vietnam. Movement restrictions generally may cause some delays, albeit no significant impact to our operational status.

(Jul 21, 2020) - Though resurging COVID-19 infections are evident in some countries across APAC, our operations remain stable and available to support customers, as we vigilantly monitor all our markets and operations, and where appropriate, taking pre-emptive steps in planning for recovery OR reinstituted restrictions. BCPs remain in effect.

For India, there have been no significant operational updates. Please refer to our India website for detailed information via download.

For Greater China, lockdowns in several northern cities as reported previously, continue to not have significant impact on our operations. Hong Kong situation deteriorated and will be closely monitored.

Indonesia extended PSBB restrictions for another 2 weeks which means a slight reduction in labor operational capacity, and Malaysia’s RMCO restrictions remain until August 31.

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 

(Aug 4, 2020) - All DB Schenker contract logistics facilities in MEA continue to operate with appropriate health and safety standards even as Oman, Kenya, and South Africa slip into partial curfew.

  • Americas 

(Aug 4, 2020) -

➢ Mexico: Our protocols are strict and working successfully, all operations are working normally.

➢ Brazil: Our sites are operating with volumes approx. 25% above average. We continue applying safety measures such as: bearing the cost of individual transportation for our employees to avoid the use of the public system, use of face masks, provision of alcohol in gel in dispensers and individually, daily communication of COVID-19 situation and best practices in our daily safety dialogues. Restrictions for face-to-face meetings and travels are still in place.

➢ Canada: No major updates. The province of Ontario has allowed Toronto and Peel regions to enter Phase 3 or reopen as of this Friday.

➢ United States: Our continued hygiene, mask and social distancing practices has prevented all sites from becoming hot spots.

  • Global Projects & Industry Solutions

(July 21, 2020) - Capacity for break bulk, for out-of-gauge cargo, but also for some cargo types which are normally transported containerized, is still available in the break bulk shipping market segment. DB Schenker is in regular exchange with all major and relevant multi-purpose vessel (MPP) operators. Full logistics services (incl. part / full charter) can be offered and bookings can be placed according to customer requests. Some operational delays are still expected following various lockdowns and restrictions implemented. In addition, quarantine measures are in place for various ports which have an impact on lead time and costs. Our dedicated Global Projects & Industry Solutions teams around the world are fully operational and support clients to develop tailored transport solutions for all break bulk or out-of-gauge shipments or any other project shipment independent of markets or trade lanes.

  • Fairs, Events and Special Logistics

(July 21, 2020) - The outlook for the global exhibition industry is generally positive as more and more countries restart exhibitions and ease existing travel restrictions. Despite this general positive situation, broad segments of the economy remain concerned and cancel their participation in exhibitions, which leads to further cancellations or postponements of scheduled events.

Our teams are in close contact with the leading exhibition organizers and associations worldwide and continue to monitor all developments closely. As the situation varies in all countries, our Global Fairs & Events Service Center is up-to-date and available to answer all your questions and assist you in all situations with tailormade solutions.

Reach out and contact our colleagues at customerservices.fairs@dbschenker.com


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 July 7 (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.