15/07/2021I'm worried that this situation is able to get worse
Thank you for your continued business
I think you know that the space for vessels is tight due to the recent vigorous export of new and used cars to all over the world. And I'm worried that this situation is able to get worse.
<Explanation of current situation and concern about worsening situation>
① Cause of tight space
1.Demand for replacement and additional purchases of new cars * is growing significantly in overseas countries.
2.All overseas countries which mainly shipped by containers, have shifted to RORO vessels. (Insufficient empty container)
3.Early dismantling of old ships by the owners. (Because they couldn't see the future of Covid-19 crisis)
* New car manufacturers and shipping companies have long-term contracts to provide space and ship a certain number of ships. Therefore, if there are many new cars, the space for used cars will inevitably decrease
② Reason for soaring Freight cost
1.Soaring vessel charter fees (fee for renting a vessel from the ship owner) (because there are many borrowers)
2.Charter fees are directly reflected in the freight cost.
3.There are too many waiting vehicles against the vessel's space. The number of shippers who want to ship even if they pay high freight cost are increasing.
③ Concerns about worsening situation
1.We received an information that new car manufacturers will "further increase production and exports."
2.The space of RORO vessels would be tighter, and the freight cost will increase further.
3.Our industry expects the container situation to not improve until the end of December.
<When will it be improved?>
Unfortunately, there is no prospect of improvement. You may assume that this will be the standard case.
However, the space tightness of RORO vessels is expected to improve if the following occur. It is expected that the freight cost will decrease if space becomes available.
1. Calm overseas demand for new cars.
2.Improvement of container space (improvement of empty container retention)
I think that you have a lot of trouble with Covid-19.
NTP Carmost export team have been / will be working so hard trying to meet your requests.