What’s up with the crowded, no space available shipping into Europe, the UK and Ireland?
Unlike shipping into New Zealand and Australia, which have dedicated used car RORO ships, the RORO shipping into the UK goes on the back of new car shipments.
So when the boat, after being filled with the high volume new cars both from China and Japan, any leftover space is used by the used car exporters.
Back in 2021, new car exports from Japan plunged due to supply chain problems, usually microchip shortages or some specific part no longer available due to China’s strict covide policy. This pain for the new car exporters was joy to the used car exporters, who were provided constant and regular space on these RORO boats. But then things started happening towards the end of 2021 that turned the furtunes back towards the new car exporters. New cars exports started getting back to their old numbers and more. Now there was a backlog of oders to fill for the new cars going into Europe. Boats were being filled to capacity with these cars. Space available for the used car exporters disappeared. Coming into 2022 and this trend has been exasperated. Now the “backlog” not only belongs to the new car makers, but also to the used car exporters.
What about the shipping lines, how do they respond to this problem? Probably by having a party.
Not only are their boats full to capacity (maximum profits), now they can raise rates as well (record profits).
Should they borrow ships from not so busy lines like from the slower southern hemisphere ships? What, and have empty space again on ships while they could just cruise along as is while enjoying record profits?
One thing we should remember, the shipping lines have no cause for concern for their used car customers, both the Japanese exporters or the European, UK or Irish importers, their only concern is to keep this record profit making season to go on for as long as they can.
Our migraine headache continues.