Maersk CEO details future strategy

Maersk CEO details future strategy
Søren Skou, CEO of A.P. Moller – Maersk

Following Maersk’s restructuring in September when it was split into separate segments, Group CEO Søren Skou has outlined plans for a core focus on transport and logistics.

Speaking at the conglomerate’s “capital markets day”, he stated that Maersk intends to separate its energy units out of A.P. Møller – Mærsk A/S.

Skou said: “When we set out the ambition of becoming a pure play container logistics, ports and container shipping company I want to emphasise that that is not an ambition to become a smaller company.”

“As we separate out the four energy businesses, we will lose something like 25% of the group’s current turnover,” he added. “We aim to replace that turnover quickly by inorganic and organic growth in transportation and logistics businesses.”

According to Skou, Maersk Line’s recently announced acquisition of Hamburg Süd will represent a step towards 15% out of the 25% “that will depart  the group over the coming years”.

When it comes to acquisition-driven growth, APM Terminals (APMT) will not be involved, with a focus on cost-cutting and increased utilisation of existing assets outlined.

The emphasis will be on “terminals that we currently have under construction successfully,” stated Skou, “and much less or not at all on planting new flags, investing in new greenfield developments.”

“We have invested a lot in APMT in the last five years. Now it’s time to fill up the capacity we already have,” he added.

The takeover of Hamburg Süd could provide APMT with significant revenue and container volumes, especially in Latin America and with reefer cargo.

“With Hamburg Süd we will build a very strong dual branded platform in Latin America, that is similar to the very successful platform we have had for years in Africa with Safmarine and Maersk Line,” said Skou.

His overall plans for Maersk’s transport and logistics businesses involve targeting five specific synergies.

These include driving increased utilisation of APMT facilities by moving Maersk Line and alliance partner volumes to the APMT terminal network.

“It’s a huge fixed cost base that we have built up and we can do more to fill it up in the coming years,” Skou stated.

He also plans to transform existing transhipment hubs into distribution centres, comparing them to models used by logistics companies such as UPS and Fed Ex.

“In the past we have operated the transhipment hubs as Maersk Line being a customer, APMT being a supplier,” said Skou. In the future these hubs will operate “as one company”.

Additionally, the group aims to sell more inland services, use joint planning of production to “turn around” reefer manufacturer Maersk Container Industry (MCI) and increase the cross selling of services.