The quickest shipping route between Europe and Asia has been hampered by attacks on vessels by Houthi terrorists in Yemen who are backed by Iran.
Targeting a corridor that carries 15% of all shipping traffic worldwide, the attacks have forced a number of shipping corporations to reroute their ships.
Some businesses' reactions to the disruptions are listed below:
AUTOS
GEELY: On December 22, the second-largest manufacturer in China based on sales stated that a delivery delay will probably have an effect on sales of electric vehicles (EVs).
MICHELIN: The French tyre manufacturer's four factories in Spain suspended operations on 20–21 January as a result of delayed deliveries of raw materials.
SUZUKI: Production at its Hungary-based plant resumed as scheduled on January 22, after stopping on January 15 owing to delays in the delivery of engines built in Japan. It stated that shipping lanes were altered to circumvent Africa, potentially impacting costs.
TESLA: Due to a shortage of parts brought on by changes in transportation routes, the American electric vehicle manufacturer will halt most car production at its facility outside Berlin from 29 January to February 11.
VOLVO CAR: Due to delays, the Swedish manufacturer said on January 12 that it will suspend operations at its Belgian plant for three days.
ENERGY
BP: The big oil company said on December 18 that it has temporarily stopped all Red Sea transits.
EQUINOR: said on December 18 that it had redirected ships that were going to the Red Sea.
EDISON: On January 25, the CEO of the energy group announced that it was beginning to see a slowdown in the supply of LNG (liquefied natural gas) from Qatar.
QATARENERGY: Despite ongoing production, the world's second-largest LNG exporter has ceased deploying tankers in the Red Sea, a senior source with firsthand knowledge of the situation told Reuters on January 15.
SHELL: The Wall Street Journal revealed on January 16 that the British oil company had halted all exports via the Red Sea indefinitely. Shell said it would not comment.
On February 1st, the company's CFO announced that he was handling day-to-day shipping choices via the Red Sea.
VALERO ENERGY: The American refiner reported on January 25 that the attacks in the Red Sea have increased the cost of shipping crude oil.
LOGISTICS
DHL: On January 8, the German logistics business urged clients to closely examine how they handle inventory. DHL does not own ships; rather, it uses them to deliver containers.
FEDEX: The massive American package delivery company stated on January 14 that, despite the Red Sea interruptions, it had not noticed much of a move to air freight.
RETAILERS
ADIDAS: CEO Bjorn Gulden stated on February 1 that delays in shipping caused by the Red Sea were detrimental to gross margins. He also mentioned that 'exploding' freight rates were increasing expenses and that some delivery problems were a result of shipping delays.
DANONE: In December, the French food conglomerate announced that the majority of its shipments had been rerouted, resulting in longer transit times. According to a representative for Danone, if the scenario persists for longer than two to three months, Danone will implement mitigation measures, such as taking detours.
IKEA: the furniture retailer stated on January 15 that it has enough inventory to withstand any supply chain disruptions and is sticking to its planned price reductions despite rising prices.
MARKS & SPENCER: The CEO of the British store stated on January 11 that the company anticipates a minor delay in clothes and home delivery due to shipping disruptions.
NEXT: The CEO of the British clothes store stated on January 4 that if interruptions persisted until 2024, sales growth would probably be slowed.
PEPCO: If difficulties continue, the owner of Poundland warned on January 18 that its supplies may be affected in the upcoming months.
PRIMARK: The financial director of Associated British Foods stated on January 23 that Primark is modifying its stock flow and timetables to accommodate disruptions.
SAINSBURY'S: The CEO of the company stated, "We're making sure that we plan the sequencing of product from Asia Pacific so that we get products in the right order," and that long-term agreements with shippers "mitigate any cost impact as far as possible".
TARGET: A person with knowledge of the situation reported on January 12 that the American retailer is facing modest delays in shipments from Pakistan and India. The source described the impact as "minor" in general.
TRACTOR SUPPLY: According to the company's main supply chain operator, deliveries for the American retailer have been delayed for two to more than twenty days as of January 12.
WILLIAMS-SONOMA: The CEO of Pottery Barn told CNBC on January 24 that the company has been rerouting shipments and preparing backup plans.
OTHERS
BHP GROUP: On January 25, the massive Australian mining company announced that some of its freight service providers were being forced to use alternate routes, like the Cape of Good Hope in Africa, due to the difficulties.
ELECTROLUX: In an effort to minimise delays, the Swedish home appliance manufacturer has formed a task team to seek priority deliveries or other routes.
Its CEO stated on February 2 that the expenses associated with the events in the Red Sea were reasonable. "If the situation is prolonged I am more worried about higher costs than about risk of having to pause production," he stated.
ESSENTIALS: The company behind TENA and Libresse said it was keeping in touch with affected suppliers to make sure the supply of goods kept flowing. Its CEO stated on January 25 that the company saw a negative impact on its freight expenses, although he did not provide an estimate of the damage.
EVONIK: the manufacturer of specialty chemicals reported that it was experiencing "short notice routing changes and delays" and that it was attempting to lessen the effects by placing orders early and, when practical, using air freight.
GECHEM GMBH & CO KG: Due to the delays, the German chemicals manufacturer announced a reduction in dishwashing and toilet tablet manufacturing.
KONE: the Finnish lift manufacturer stated that while some shipments may be delayed, most of its customers' deliveries ought to go as planned. Kone claimed that it has looked for alternate delivery routes and techniques in anticipation of the disruptions.
LEVI STRAUSS & CO.: Due to ongoing problems with Red Sea shipping, the denim manufacturer is facing transport delays of ten to fourteen days. In order to avoid the Red Sea and the Suez Canal, certain American exports have been moved to the West Coast.
LOGITECH: The CEO of the computer peripheral manufacturer stated on January 23 that the Red Sea situation will impact business margins by driving up transportation prices.
(Sourec:www.reuters.com)
Targeting a corridor that carries 15% of all shipping traffic worldwide, the attacks have forced a number of shipping corporations to reroute their ships.
Some businesses' reactions to the disruptions are listed below:
AUTOS
GEELY: On December 22, the second-largest manufacturer in China based on sales stated that a delivery delay will probably have an effect on sales of electric vehicles (EVs).
MICHELIN: The French tyre manufacturer's four factories in Spain suspended operations on 20–21 January as a result of delayed deliveries of raw materials.
SUZUKI: Production at its Hungary-based plant resumed as scheduled on January 22, after stopping on January 15 owing to delays in the delivery of engines built in Japan. It stated that shipping lanes were altered to circumvent Africa, potentially impacting costs.
TESLA: Due to a shortage of parts brought on by changes in transportation routes, the American electric vehicle manufacturer will halt most car production at its facility outside Berlin from 29 January to February 11.
VOLVO CAR: Due to delays, the Swedish manufacturer said on January 12 that it will suspend operations at its Belgian plant for three days.
ENERGY
BP: The big oil company said on December 18 that it has temporarily stopped all Red Sea transits.
EQUINOR: said on December 18 that it had redirected ships that were going to the Red Sea.
EDISON: On January 25, the CEO of the energy group announced that it was beginning to see a slowdown in the supply of LNG (liquefied natural gas) from Qatar.
QATARENERGY: Despite ongoing production, the world's second-largest LNG exporter has ceased deploying tankers in the Red Sea, a senior source with firsthand knowledge of the situation told Reuters on January 15.
SHELL: The Wall Street Journal revealed on January 16 that the British oil company had halted all exports via the Red Sea indefinitely. Shell said it would not comment.
On February 1st, the company's CFO announced that he was handling day-to-day shipping choices via the Red Sea.
VALERO ENERGY: The American refiner reported on January 25 that the attacks in the Red Sea have increased the cost of shipping crude oil.
LOGISTICS
DHL: On January 8, the German logistics business urged clients to closely examine how they handle inventory. DHL does not own ships; rather, it uses them to deliver containers.
FEDEX: The massive American package delivery company stated on January 14 that, despite the Red Sea interruptions, it had not noticed much of a move to air freight.
RETAILERS
ADIDAS: CEO Bjorn Gulden stated on February 1 that delays in shipping caused by the Red Sea were detrimental to gross margins. He also mentioned that 'exploding' freight rates were increasing expenses and that some delivery problems were a result of shipping delays.
DANONE: In December, the French food conglomerate announced that the majority of its shipments had been rerouted, resulting in longer transit times. According to a representative for Danone, if the scenario persists for longer than two to three months, Danone will implement mitigation measures, such as taking detours.
IKEA: the furniture retailer stated on January 15 that it has enough inventory to withstand any supply chain disruptions and is sticking to its planned price reductions despite rising prices.
MARKS & SPENCER: The CEO of the British store stated on January 11 that the company anticipates a minor delay in clothes and home delivery due to shipping disruptions.
NEXT: The CEO of the British clothes store stated on January 4 that if interruptions persisted until 2024, sales growth would probably be slowed.
PEPCO: If difficulties continue, the owner of Poundland warned on January 18 that its supplies may be affected in the upcoming months.
PRIMARK: The financial director of Associated British Foods stated on January 23 that Primark is modifying its stock flow and timetables to accommodate disruptions.
SAINSBURY'S: The CEO of the company stated, "We're making sure that we plan the sequencing of product from Asia Pacific so that we get products in the right order," and that long-term agreements with shippers "mitigate any cost impact as far as possible".
TARGET: A person with knowledge of the situation reported on January 12 that the American retailer is facing modest delays in shipments from Pakistan and India. The source described the impact as "minor" in general.
TRACTOR SUPPLY: According to the company's main supply chain operator, deliveries for the American retailer have been delayed for two to more than twenty days as of January 12.
WILLIAMS-SONOMA: The CEO of Pottery Barn told CNBC on January 24 that the company has been rerouting shipments and preparing backup plans.
OTHERS
BHP GROUP: On January 25, the massive Australian mining company announced that some of its freight service providers were being forced to use alternate routes, like the Cape of Good Hope in Africa, due to the difficulties.
ELECTROLUX: In an effort to minimise delays, the Swedish home appliance manufacturer has formed a task team to seek priority deliveries or other routes.
Its CEO stated on February 2 that the expenses associated with the events in the Red Sea were reasonable. "If the situation is prolonged I am more worried about higher costs than about risk of having to pause production," he stated.
ESSENTIALS: The company behind TENA and Libresse said it was keeping in touch with affected suppliers to make sure the supply of goods kept flowing. Its CEO stated on January 25 that the company saw a negative impact on its freight expenses, although he did not provide an estimate of the damage.
EVONIK: the manufacturer of specialty chemicals reported that it was experiencing "short notice routing changes and delays" and that it was attempting to lessen the effects by placing orders early and, when practical, using air freight.
GECHEM GMBH & CO KG: Due to the delays, the German chemicals manufacturer announced a reduction in dishwashing and toilet tablet manufacturing.
KONE: the Finnish lift manufacturer stated that while some shipments may be delayed, most of its customers' deliveries ought to go as planned. Kone claimed that it has looked for alternate delivery routes and techniques in anticipation of the disruptions.
LEVI STRAUSS & CO.: Due to ongoing problems with Red Sea shipping, the denim manufacturer is facing transport delays of ten to fourteen days. In order to avoid the Red Sea and the Suez Canal, certain American exports have been moved to the West Coast.
LOGITECH: The CEO of the computer peripheral manufacturer stated on January 23 that the Red Sea situation will impact business margins by driving up transportation prices.
(Sourec:www.reuters.com)
