DB Schenker business unit

Development in the relevant markets

Land transport

Europe

• European land transport experienced a decline in 2020 due to the Covid-19 pandemic.
• After falling prices and falling demand between April and August 2020, prices rose to at least the previous year’s level from October 2020, and there was a noticeable increase in demand.
• Investments in digital platforms for consolidating supply and demand of transport capacities added to the existing pressure on margins.
• Risks caused by various cost drivers remained: driver shortages led to rising salary costs. Fuel prices fell significantly due to the Covid-19 pandemic, but rose again slightly from mid-2020. Toll costs also increased.
• The need for adjustment grew as a result of increasing changes in the shipping structure and investments in digital structures.
• Human resources and legal expenses were also incurred as a result of Brexit preparations.

Americas

• There was very limited truck capacity in the USA from July 2020 due to the impact of the Covid-19 pandemic and the imbalance in port capacities on the west coast. Transport costs rose dramatically in a number of markets and in most cases with reduced profit margins.
• There were no significant capacity bottlenecks in Canada and Mexico.

Asia/Pacific

• Domestic business in Asia/Pacific countries was impacted by Covid-19 shutdowns from February to July 2020, with an average volume decline of 30 %, which gradually recovered from August 2020.
• International business in Asia and Eurasia saw a volume increase of 50 %, which is mainly due to the shift in volume caused by restrictions in international air and ocean transport.

Air freight

• 2020 was heavily influenced by market factors related to Covid-19 on all trade routes. When the pandemic began and countries consequently shut down, all trade routes experienced double-digit percentage drops.
• This development was significantly exceeded by the decline in available air freight capacity on the market, which triggered a major shift in terms of rising freight prices.

Ocean freight

• The global growth of container ocean freight declined sharply during 2020; the market experienced a historic low in May 2020 with a decline in volume of up to 20 %. There was a surprisingly quick recovery from the third quarter of 2020 onward, although the previous year’s level was not reached again.
• Volume development was not uniform on the main trade routes, with intra-Asia and transpacific routes experiencing the strongest growth.
• Freight rates continued to rise sharply throughout 2020. Shipping companies limited the available capacity by cancelling empty runs. This approach remained even when freight volume began to recover.
• The bottlenecks in container capacity had an additional impact on ocean freight.

Contract logistics

• Overall, the global contract logistics market again declined in 2020, mainly due to the impact of shutdowns, disruptions to supply chains, and the resulting lower volumes in existing networks.
• Delays with the new outsourcing projects due to Covid-19 also contributed to this downward trend.
• Developments in individual market sectors ranged from double-digit percentage growth in e-commerce and pharmaceuticals and moderate growth in mass consumer electronics and goods, to sharp declines in the general retail, aerospace, automotive and industrial industries.