Literature review on the topic of deviation in international carriage Essay

Literature review on the topic of deviation in international carriage of goods and trade - Essay Example It led to an explosion of world trade that involved people in all over the world. (Wilson 8-12) Transportation is a significant part of doing business globally. Freight logistic companies nowadays have to adapt themselves to serve customers' need which is endless. Customers have become global, they require global support and multimodal capabilities. They are interested to use fewer service providers to extend cooperation and communication among modes and between carriers to them. The role of the freight forwarder is changing from an agent who arranges transportation and prepares shipping documentation to a provider of the whole range of additional value-added services to shippers. At the same time, many forwarders are merging with large logistics companies to become part of one-stop-shop specialist companies. (D'Arcy 71-80) In 2002, market demand grew by double digits. As China joined the World Trade Organisation, many multinationals relocate production of a whole range of consumer goods from their domestic plants, mainly in the US and Europe, to this region, where production costs are much cheaper, which led to rapid growth in all trades from China. The major route of ship liners are divided into three main routes, Transpacific (Asia/US), Asia/Europe/Asia, and Transatlantic (US/Europe). The strength of the Transpacific (Asia to US East Coast) trade is continuing, with 491,000TEU moving in 3Q 2003, 18% up from 2Q 2003 and 5.6% up from the same period in 2002. (Chuah 1-22) This has been encouraged by low interest rates despite the slowdown in the US economy. The Asia-Europe trade also grew by 11% in 2002, and carriers have deployed any extra ships on the Asian trades to maximise profits. This strategy is also benefiting other trades such as the Transatlantic, as it keeps the supply of capacity down. Market share of shipping company is based on their capacity in number of TEU(Twenty-foot Equivalent Unit). The top-ten liners are held around 40% of the whole market, while the total market has 459 different players faced with high competitive environment. (Schnitzer 5-25) Maersk Sealand held the largest proportion of market share in the industry over the last five year. Not only the biggest by far but also probably one of the best equipped lines to face the future. MSC (Mediterranean Shipping Company) are a young shipping line. (Taylor 87-99) The company has grown incredibly fast and ranking number two toward this year and last year. P&O Nedlloyd was following the merger of P&O Containers (UK) and Nedlloyd Lines (Rotterdam). It face with high competitive and fell down to 3rd ranking since 2002. The settlement in the contract is mainly composed of the service provided by the shippers, the flexibility of services, price and the length of contract. The leading companies try to get the globe shipper to be in the part of their portfolio. (Todd 11-13) Due to the fact that a different group of clients have different requirements, some may look for the quality of service rather than price. As a result, the shipper has to offer the tailor-made contract to each group of customer. Whenever the contract has been signed, it means that the carrier is obligated with their promise. In case of missing their commitment, the shippers would loose their reputation which is