Technavio market research analysts forecast the global dry container fleet market to grow at a CAGR of close to 3% during the forecast period, according to their latest report.

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Technavio has published a new report on the global dry container fleet market from 2017-2021. (Graphic: Business Wire)

The market study covers the present scenario and growth prospects of the global dry container fleet market for 2017-2021. The report lists open-top containers, bulk containers, flat rack containers, and ventilated containers as the four major segments based on container type. Open-top containers accounted for the highest share among all the container types in 2016.

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Technavio analysts highlight the following three market drivers that are contributing to the growth of the global dry container fleet market:

  • Growing intermodal transportation
  • Formation of alliances for cost saving
  • Upgrading of communication systems

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Growing intermodal transportation

Intermodal transportation is highly efficient, environmentally friendly, and requires low investments. It uses different modes of transportation for the transport of goods from one place to another. It is estimated that intermodal transportation will grow at a CAGR of more than 8% during the forecast period. This transportation is easy to track and involves only a few idle periods during the operation. It offers door-to-door delivery, a shorter delivery time, ensures cargo safety, and involves the use of different routes.

“The intermodal freight transportation industry is introducing some major advances in technology such as computerized vehicle routing, online freight exchange, and active traffic management. Heavy vehicles, consumer goods, and the automotive industry rely on intermodal transportation to transport goods,” says Sharan Raj, a lead analyst at Technavio for logistics research.

Formation of alliances for cost saving

Factors such as the global economic slowdown, high operational costs, and low profitability are forcing shipping companies to pool their resources and share shipping containers to minimize costs. Several leading vendors are entering into strategic partnership agreements and joint ventures to strengthen their market dominance. These companies share container space for capacity utilization. This results in minimizing their operational costs. Many companies in the dry container fleet industry are forming alliances due to the high debts, low freight prices, low rates of return, and high capital investments in the industry.

“High-capacity vessels enable major cost cutting in three areas, namely, bunker costs, operational costs, and capital costs. These vessels are characterized by their high engine capacity, large dock space, high bollard pull, and increased storage capacity. The vessels have high utilization rates and use the latest technologies. The premium day rates for these vessels are high. Therefore, they generate more revenue for vessel operators,” says Sharan.

Upgrading of communication systems

A communication system is extremely essential for better container fleet management and for effective and efficient delivery. Hapag-Lloyd has signed an agreement to migrate its fleet of dry container ships to Inmarsat’s Fleet Xpress satellite communications. This involves upgrading the communication systems on the nearly 80 ships it manages. It also involves the installation of new communications systems on its fleet of container ships, which has a total transport capacity of 953,000 TEUs during the forecast period.

Container shipments require fully managed migration to high-speed broadband along with redundant service. This is scalable for any future fleet growth. Ship communications are crucial as they allow the vessel operator to integrate onboard IT systems with onshore networks.

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Technavio ResearchJesse MaidaMedia & Marketing ExecutiveUS: +1 630 333 9501UK: +44 208 123 1770www.technavio.com