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MAERSK ABSORBS ITS FREIGHT FORWARDING UNIT, DAMCO
September 4, 2020
Maersk

Maersk recently announced that it will integrate its freight forwarding division, Damco, into its line to streamline its business.

 

"A.P. Moller - Maersk announces changes in Ocean & Logistics to enhance customer experience. The Safmarine brand and Damco’s Air and LCL will be integrated into Maersk’s logistics and services products to complement its end-to-end offering," the shipping major said.

 

Many of Damco’s current freight forwarding offerings, it noted, will be integrated into Maersk’s logistics portfolio, including Damco’s airfreight and less than container load (LCL) products.

 

Maersk said in a statement that these changes represent a major step towards becoming an integrated container transport and logistics company, connecting and simplifying customers’ supply chains.

 

Streamlining business to meet customer needs

 

“Our customers are at the heart of our vision. Their evolving supply chain needs are increasing the demand for multiple modes of transport and to meet these needs, we’re bringing our company’s expertise and capabilities even closer together. Taking these steps are key to accelerating our transformation,“ said Vincent Clerc, CEO of Ocean & Logistics, A.P. Moller - Maersk.

 

It added that over time, the value propositions of Maersk and Safmarine have converged, as both brands have been focusing on building a customer-centric culture and as the digital interactions with customers have increased.

 

“With the integration of Safmarine, we can present Safmarine customers with the full ocean and supply chain offering and more scale. At the same time, I’m very excited to have Safmarine’s passion for customers closer to Maersk by uniting our teams,” Clerc said.

 

Meanwhile, since focusing purely on freight forwarding in 2018, Damco has demonstrated significant value to customers in the Air and Ocean LCL space.

 

“During this time, it has become apparent through close customer engagements that the value proposition of Maersk can be greatly enhanced with the expansion of multiple modes of transport,” Maersk said.

 

It added that the integration of Air and LCL into Maersk will help meet these needs and give businesses access to a simplified, connected and agile experience under the Maersk brand, as well as to its scale. Maersk uses its own assets to offer unique value propositions, hence it will not pursue the Ocean FCL Multi-carrier product (NVOCC) as a general offering.

 

“Businesses need Air and LCL products to connect their supply chains and with these offerings firmly placed in our global integrated portfolio, we aim to serve our businesses better and more efficiently across their supply chains,“ Clerc further said.

 

Due to the changes, the Safmarine and Damco brands will no longer be marketed by the end of 2020.

 

In addition, Maersk will simplify its organisational structure across Ocean & Logistics globally to further improve customer centricity and efficiency. As part of this, the back offices of Maersk and Hamburg Süd will come closer together into more customer-centric teams, while continuing to meet customers as two separate brands with a differentiated service model.


Acquisition of KGH Customs Services

 

On September 2, A.P. Moller - Maersk also announced it has finalised the acquisition of KGH Customs Services, a pan-European customs services provider, further strengthening its capabilities as an integrated container logistics company, offering end-to-end supply chain solutions to its global customers.

 

Lars Börjesson, CEO of KGH Customs Services said the acquisition will see KGH “closely collaborating” with Maersk to provide a range of different services within the transportation and logistics industry as one combined entity.

 

“Our enhanced product portfolio and geographical reach will enable us to serve our customers and their growing needs even better”, Börjesson said.

 

During the remainder of 2020, Maersk and KGH teams will work together on establishing a joint operating model and optimal structure to serve their customer base going forward.

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