Hapag-Lloyd has said it will invest in digitalization and automation as part of its plan to deliver greater value for customers, as part of its ‘Strategy 2023’.
The fifth biggest carrier in the world also said that its financial targets between 2019 and 2023 would focus predominantly on generating economic value by delivering a Return on Invested Capital (ROIC).
The company says it will, therefore, aim to maintain an earnings before interest, taxes, depreciation, and amortization (EBITDA) margin of 12%.
— Hapag-Lloyd AG (@HapagLloydAG) November 21, 2018
To that end, it has launched a cost management programme with a savings run-rate target of USD $350 – 400 million, which also look to maintain a competitive cost position after launching Strategy 2023.
In a statement, Hapag-Lloyd said: “Following a period of consolidation, the liner shipping industry has changed significantly. Hapag-Lloyd is more than two times larger than it was in 2014 in terms regarding transport capacity.
“At the same time, further consolidation amongst the largest players in the industry is less attractive due to decreasing incremental scale benefits.
“As a result, the industry has come to a turning point. Hapag-Lloyd will, therefore, focus on significantly improving quality for its customers, selective global growth and becoming profitable throughout the cycle.”
Rolf Habben Jansen, Hapag-Lloyd’s CEO, expanded on the aims of Strategy 2023: “Size is not the name of the game anymore, but customer orientation.
“It is obvious that customers expect more reliable supply chains, so our industry needs to change and invest more.
At the same time, we know that people are prepared to pay for value. Going forward, delivering value to get the most attractive cargo on board is at the heart of our new Strategy 2023.
“To be number one for quality is the ultimate promise to our customers and a strong differentiator from our competitors.”