Hapag-Lloyd Symposium: What’s the future of the global shipping industry?

Hapag Lloyd Symposium crowded entrance area

What are opportunities for the global shipping industry with decarbonization, possible de-growth, restructuring supply chains, and newly emerging geographies of trade? How can shipping evolve? And what are the roles of technology and digitalization in this transformation? International maritime experts from academia, business, and politics came together to discuss these questions for the 175th anniversary of Hapag-Lloyd. The event was organized by KLU, Hapag-Lloyd, and the Hapag-Lloyd Center for Shipping and Global Logistics (CSGL).

The symposium started off with a reception at Hapag-Lloyd’s headquarters on the Binnenalster in Hamburg. Though daily life in Europe is mostly back to normal, the effects of the worldwide coronavirus pandemic are still immense. The pressure on the entire logistics industry is enormous, particularly for container liner shipping. At the same time, a global recession seems more than likely. How will the industry change under these circumstances? Hapag-Lloyd CEO Rolf Habben Jansen, Vespucci Maritime CEO and Partner Lars Jensen, and CSGL Director Prof. Gordon Wilmsmeier discussed different scenarios for the future.

Information islands vs. the big solution

The next day the symposium at Kühne Logistics University focused on three of the main topics concerning the shipping industry these days: digitalization, decarbonization, and de-growth. Digitalization, especially platforms that collect data for customers or companies, is one of the major trends in global shipping. The panel featured Nils Havsager (Hapag-Lloyd), Stewart Jeacocke (IBM/TradeLens), Philippe Lavarde (Closelink), Dr. Mikael Lind (Chalmers Univ. of Technology), and moderator Prof. Rod Frankling (KLU), who discussed the opportunities and limits of collaboration within these logistics platforms.

“What you see right now are silo developments, where companies try to bring up their own platforms. I think that is just the first phase of digitalization”, said Philippe Lavarde. According to Lavarde, the positive effect of this development is that stakeholders digitize themselves, which in turn enables platforms to connect with and include these stakeholders going forward. With new platforms springing up like mushrooms, Stewart Jeacocke stressed the importance of bringing the information together. “A platform that shows it all is crucial”, he said. An opinion challenged by Mikael Lind, who believed different “information islands” will be existing in several years, while “one winner” is unlikely to be found. Building upon a federated approach to digital data sharing, information would need to be shared between the different islands dependent on use case. Taken together, the panel agreed that the industry’s path towards increased digitalization is a journey, sometimes even a Wild Wild West – and it has just started.

Shipping must be decarbonized – or does it?

The second panel of the day featured Lucienne Damm (TUI Cruises), Dr. Frank Dubielzig (Hapag-Lloyd), Dominik Englert (World Bank), Dr. Peter Liese (EVP), Dr. Elizabeth Lindstad (SINTEF Ocean), and moderator Prof. Alan McKinnon (KLU), who shed light on the ambitious goal of reaching zero emissions by 2050. While Dominik Englert stressed the opportunities for the shipping industry that might arise – including e.g. the transport of e-fuels to Europe – Lucienne Damm added that industry association and companies like TUI Cruises have even more ambitious goals than IMO’s net-zero target by 2050.

But is it possible to reach these goals – and is it a smart thing to do? “I do not think it’s possible”, said Elizabeth Lindstad (SINTEF Ocean), “We need to use energy in a smarter way. I don’t say that shipping shouldn't work on reducing emissions, but I'm saying that the most efficient way for shipping to reduce its emissions is to reduce the energy consumption, for example through better vessel designs.” If, in addition, the production of renewable energy is ramped up globally and other sectors, which are more easily decarbonized, are doing so, shipping largest contribution to global decarbonization, will be through more slender vessel designs including  wind assisted propulsion, technical and operational improvements, she stated.

“We don’t want to lay back,” Hapag-Lloyd’s Frank Dubielzig replied, “The transition needs time, and the time to start is now." Despite these differences, the panel agreed that e.g. wind and other alternative fuels and propulsion methods like batteries will be useful to reduce energy consumption in the sector and lower emissions. “The fuel mix of the future will be not as simple as in the past”, summarized Lucienne Damm.

The end of growth?

Keynote speaker Christiaan De Beukelaer, Senior Lecturer in Culture & Climate at the University of Melbourne and Institute of Advanced Study Fellow at Durham University, shed light on the question of "green growth" vs. "de-growth.“ He argued that we need to ensure that humanity lives within planetary boundaries while ensuring everyone can live a good life. This means that “overdeveloped” countries need to reduce the pressures they exert on the planetary boundaries, which they have often already transgressed, while “underdeveloped” countries need to be able to be able to meet all social thresholds, which has remained a challenge despite sustained economic growth. While perpetual growth on a finite planet is by definition impossible, some countries still require more resources, technologies, and growth to ensure their citizens decent lives. His book Trade Winds further reflects on this challenge.

Interview Series

Leading up to the event, Gordon Wilmsmeier, Director of the Hapag-Lloyd Center for Shipping and Global Logistics (CSGL) at KLU, spoke with three of the panelists.