Categories: Business

A crisis in the Red Sea begins to penalize industry

The first impact of the military escalation in the Red Sea between Westerners and Yemen’s Houthis is being felt on industrial activities in Europe, and first of all on the automobile sector. Thus, Tesla announced on Thursday January 11 that it will suspend the production of electric vehicles at its German factory between January 29 and February 11, due to a shortage of components manufactured in Asia. “Significant increase in transportation time is creating a gap in supply chains”The American manufacturer explains.

Also Read | Articles are reserved for our subscribers
In the map, the Red Sea under fire from the Houthis

The next day, Swedish Volvo, owned by Chinese Geely, announced a three-day shutdown at its Belgian factory in Ghent the week of January 15 due to a gearbox shortage. Geely, like furniture maker Ikea, warned its customers about delivery delays. Longer delivery times and potential port congestion will penalize other companies further down the supply chain.

Since November 2023, the US Central Command in the Middle East has recorded 27 attacks by drones, missiles and ballistic missiles. Fewer and fewer ships are using the Red Sea and the Suez Canal, which typically sees 12% of international trade and a good share of containers bound for Europe.

“Inflationary Pressure”

The four major European shipowners (MSC, Maersk, CMA CGM and Hapag-Lloyd), which provide 53% of global transport by “box”, are now avoiding the perilous Bab al-Mandab Strait, at the entrance to the Red Sea, and the Cape of Divert their container ships through the Good Hope. By the end of November twice as many ships are crossing the tip of Africa, extending the Asia-Europe journey by 13,000 kilometers and ten days. Many consignments will take longer to unload in Rotterdam (Netherlands), Antwerp (Belgium), Marseille (Boches-du-Rhône) or Genoa (Italy).

Now, 90% of container ships avoid the Isthmus of Egypt, according to Clarkson Research Services, a subsidiary of the world’s largest shipping broker. This diversion caused a 40% reduction in revenue for Egypt, which owns the canal. The crisis led to a decline in trade flows, which was estimated by the Institute of World Economy in Kiel (Germany) to be -1.3% globally between November and December 2023, and reached 2% and 3%, respectively. .1% for exports and imports between Asia and Europe.

You have 60% of this article left to read. The rest is reserved for subscribers.

Source link

Admin

Share
Published by
Admin

Recent Posts

100 million degrees for 48 seconds: South Korea’s ‘artificial sun’ moves closer to nuclear revolution

This is a new record that scientists from the Korea Fusion Energy Institute (KFE) have…

8 months ago

The report offers solutions for insurers facing future growth in natural disasters

Damages associated with drought, floods, hail and other increasingly violent events are expected to increase…

8 months ago

You still have time to claim this exciting investigation

An estimated 9 million people in the United States are still waiting for their final…

8 months ago

IDF recognizes “serious mistake” in killing seven members of NGO World Central Kitchen

The death of seven humanitarian workers from the American NGO World Central Kitchen in an…

8 months ago

Fortnite Shop Apr 3, 2024 – Fortnite

Today, at one o'clock in the morning, Gamer updates it Boutique de Fortnite Through the…

8 months ago

Sharon Stone tried to make a Barbie movie in the 1990s

The Basic Instinct and Casino actress looks back at a time in Hollywood when adapting…

8 months ago