Consultant Insight: Maersk and CMA CGM as logistics providers

Maersk and CMA CGM are moving inland by adding logistics capabilities along with their air and ocean capabilities. [caption id="attachment_69752" align="alignright" width="298"] Cathy Roberson, Cargo Facts Consulting senior consultant and Air Cargo World columnist[/caption] Last week, we looked at Maersk and CMA CGM's investments in airfreight in Part I of our analysis of the ocean shipping giants . In this week’s Part II analysis, we'll look at their logistics acquisitions and how logistics plans align with each ocean vessel carriers' strategy. CMA CGM's logistics acquisitions have primarily served to beef up its logistics and freight forwarding arm, CEVA Logistics, acquired in 2019. "With CEVA, CMA CGM has confirmed its position as a leading worldwide maritime transport and logistics group, supported by a team of 110,000 employees,” Rodolphe Saade, Chairman and CEO of the CMA CGM Group, said at the time of the acquisition. Recent acquisitions The latest acquisition of GEFCO was announced April 8 and will provide CEVA with additional expertise in European automotive logistics and multimodal supply chains. This acquisition is notable due to its previous ownership by the Russian Railway and carmaker Stellantis. As part of a special procedure, the European Commission authorized CMA CGM to acquire the capital of GEFCO immediately, pending the final approval that will take place in the coming months. CMA CGM also recently completed the acquisition of Ingram Micro's Commerce & Lifecycle Services (CLS) and of Colis Prive, with acquisitions announced Dec. 8, 2021, and Jan. 31, respectively. These acquisitions provide CEVA Logistics with more e-commerce solutions and European last-mile capabilities. The combination of CEVA Logistics and Ingram Micro CLS activities will create the fourth-largest global provider of contract logistics services and supports its objective to become a top-five global third-party logistics player, according to a release . Meanwhile, most of Maersk's recent logistics acquisitions focus more on the U.S. In February, the company made its latest acquisition, purchasing Pilot Freight Services , a U.S.-based transportation service provider specializing in the business-to-business (B2B) and business-to-consumer (B2C) big and bulky freight segment. This complements the 2021 acquisition of Visible Supply Chain Management , which is focused on B2C parcel delivery and B2C fulfillment services in the U.S. Maersk picked up LF Logistics, based in Hong Kong, between these two acquisitions. LF Logistics provides omnichannel fulfillment services, e-commerce and inland transport in the Asia-Pacific region. "With the acquisition of LF Logistics, we add critical capabilities in the Asia Pacific to support our customers' long term growth in the Asia Pacific and capabilities and technology we can scale in our contract logistics business globally," Maersk CEO Soren Skou said in the announcement . "We will boost our warehousing and distribution offering and respond to the rapidly growing needs of our customers for contract logistics.” Similar strategies Last year, CMA CGM unveiled a new strategic approach called Better Ways , which according to the company includes the "building of a complete and seamless range of services, from warehouse management to shipping, to overland transport and air freight, all within the CMA CGM Group's shipping entity, its logistics subsidiary, CEVA Logistics, and its new CMA CGM Air Cargo division." The strategy also includes investments in research and development as well as in the internet of things (IoT), artificial intelligence and blockchain solutions to develop "smarter and more secure service offerings, while delivering a smoother user experience for both customers and employees." The connectivity among CMA CGM divisions appears to be lacking compared with Maersk, which has made numerous investments in proprietary and off-the-shelf technologies to piece together what it describes as an "end-to-end supply chain." Maersk is placing a big bet that shippers want such an offering. Indeed, studies have shown that end-to-end solutions can be beneficial from a security and visibility standpoint. However, some shippers are hesitant to put all their logistics eggs in one basket and instead prefer to work with several logistics partners. According to the 2022 3PL Study , 59% of 3PL users surveyed reported reducing or consolidating the number of 3PLs they use. This percentage has remained relatively constant over the past few years. What direction shippers will take in using just one 3PL or a small group of 3PLs remains to be seen.

Consultant Insight: Maersk and CMA CGM as logistics providers

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