Neel Jones Shah is a smart guy and a dreamer and doer.
He is no shrinking violet either, but rather someone who is
actively on the front lines of change having moved rather easily from
top management at the airlines into top management at the wunderkind bunch
at Flexport where he serves as EVP and Global Head of Airfreight.
In addition, Neel sits on the Board of Directors of Amerijet International
Holdings, Global K9 Protection Group and is a Senior Advisor to The Boston
Prior to Flexport, Neel served as the Senior Vice President
& Chief Cargo Officer for Delta Air Lines.
As the head of Delta Cargo, he led approximately 2,000 employees worldwide
and oversaw over $1 Billion in freight & mail revenue.
So while unrest in Hong Kong ahead of the vaunted end of year rush continues
to cloud an otherwise lackluster 2019 Neel leans in with some thoughts
of what’s up and likely to happen.
impact has Hong Kong unrest having on cargo to and from China & Intra
bulk of disruption at the Hong Kong airport was to belly cargo. Since
the vast majority of our capacity is via our own Private Air Service or
other freighters, we did not face many issues. We’re keeping a close
eye on the situation. Things can change overnight so we’re staying
close to clients and partners to keep everyone informed.
ahead, what will be the impact on the traditional Christmas rush?
too early to speculate how the unrest in Hong Kong will impact the holiday
rush. However, with the level of volatility in the market, airlines will
have to plan accordingly to handle the increased demand for capacity,
on top of any unforeseen issues like regional unrest or new tariffs.
NJS: Near term:
There may be isolated volume increases ahead of the Sept. 1 and Dec. 15
tariff deadlines, which will strain the supply chain further downstream.
West coast warehouses are already saturated with inventory
from companies front loading in late 2018 and early 2019. We’ll
see rate increases across trucking, rail and warehousing to accommodate
spikes in demand.
Long term: Uncertainty is the new norm. All stakeholders will
need to plan and allocate resources appropriately.
should shippers do; What are you advising your shipping partners?
NJS: Start planning
now. We may see continued volatility this year, including renewed unrest
in Hong Kong, a hard no-deal Brexit, or a flare up of Middle East hostilities
coupled with annual holiday shipping capacity constraints. With all of
these events coming together, shippers will need to have a plan.
FT: Any other
thoughts about this year, such as the tariff situation.
NJS: You know,
no one wins in a trade war. Our mission is to make global trade easy for
everyone, so any obstacle in the way of trade is one too many. The U.S.-China
market could be hit with a capacity crunch as shippers assess the potential
savings to avoid tariff impacts, especially at the end of August 2019.
Many shippers will try and take advantage of the available capacity, especially
the capacity that Flexport is able to offer, in order to avoid the additional
cost from potential tariffs. This uptick will tighten the capacity from
China to U.S. and potentially justify the need for greater freighter capacity
on the trade lane.