Tag: household goods transportation

Many Ocean Shipping Lines Are Moving to Aircraft

Post author By Ann Knapp | CRP, GMS, CMC
Post date January 31, 2023

airplane flying over large shipping containers — Airplane flying above container port.

Many household goods shipping companies are investing in air travel

As shippers look for more efficient ways to ship household goods worldwide, ocean freight companies are increasingly turning to air cargo. Although airfreight represents only a tiny section of the broader cargo industry, the pandemic has caused it to become more prominent due to supply chains, travel bans, and consumer spending issues.

Air travel has become increasingly important for companies engaged in maritime trade due to the recent pandemic. With more people shopping online, household goods shipping companies are struggling to keep up with demand. This has caused ships to be idly anchored at congested ports, unable to dock for weeks at a time. Further complicating matters is a shortage of workers assigned to load and unload vessels. Containers that could be used to hold exports are instead sitting unused, while exporters with plenty of goods to ship need help to get containers.

The three dominant European container shipping companies (AP Moeller-Maersk, CMA CGM Group, and Mediterranean Shipping Co.) have primarily avoided airfreight, feeling that it is an expensive distraction from their core businesses of operating giant vessels, container terminals, and related logistics operations around the world. However, executives claim that many customers are now opting for air shipping because it is more cost-effective and reliable. Maersk, the world’s largest container shipping company, began an air cargo division in April last year and now has a fleet of 15 planes.

Ocean Freighters Turning to Buy Air Planes

Boeing and Airbus are now part of this equation as they started selling freighter versions of their newer widebody planes. These freighters are more fuel-efficient than older cargo jets. And to show the rising demand for converting old passenger planes into freighters, it should be noted that some have been booked up for years.

In recent reports, Maersk is anticipating free cash flow to be about $19 billion by the end of 2022. The company plans to obtain seven Boeing 767s (purchase three and lease four) by the new year. The idea would be to have aircraft fly routes between Asia, the United States, and Europe.

Last year, Maersk moved into the air cargo game and increased volume by 100% after purchasing German air freight company, Senator International. In addition, Maersk has been buying airplanes for its air cargo division, which was formerly called Star Air. The division, contracted by United Parcel Service Inc. and Germany’s DHL to fly freight, now operates with 15 Boeing-made 767 freighters.

Also, earlier this year, CMA CGM, the world’s third-biggest ocean shipper, agreed to share cargo space with Air France-KLM. And on top of that, CMA CGM said it would buy a 9% stake in the airline.

Numbers released by the International Air Transport Association (IATA), last year, the airfreight industry grew over 21%. This means that revenue will increase to $289 billion in 2022, up from $238 billion last year.

Boeing reported that about 400 freight planes had been added to the world fleet in the past three years. This is an eye-opening 20% rise. Boeing is now estimating that the global freighter fleet will increase to about 3,600 by 2040. To put that number in perspective, it is currently around 2,000.

How Increased Airfreight Will Affect Global Mobility & Relocation Industry

In the past, airfreight for relocations was too expensive, and many relocation companies didn’t even consider it an option. However, the lowering costs and the congestion of ports have now made a more realistic answer for many.

As airfreight rates become more affordable, international relocation companies can choose to ship household goods by air. With more employers turning to lump sum packages for relocations and ocean shipping delays being a common factor, transferees are leaving more of their belongings behind when they move abroad for a work assignment. The fewer belongings the employee brings means the quicker they can move, meaning the more likely they are to choose airfreight for their next relocation. Although the airfreight method is still quite costly, it eliminates many relocation delays, significantly improving the transferee’s experience.

Global Mobility Solutions (GMS) is the industry leader in Global Mobility, which is why we stay on top of all topics regarding relocation. Visit our Knowledge Base to learn more about hot topics in the relocation industry. And feel free to reach out to us with any questions regarding the household goods shipment.

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Tags Household Goods Movement Management, household goods shipping, household goods transportation

Domestic Relocation Trends Global Relocation Trends Household Goods Relocation Challenges

Household Goods Summer Update

Post author By Ann Knapp | CRP, GMS, CMC
Post date August 2, 2022

Big truck of delivery company with cargo is driving on forest road in the mountains at sunset.

The HHG Industry & The Summer of 2022

While the summer household goods moving season is heating up, 2022 is shaping to be hotter than usual. The summer of ‘22 is the perfect storm which includes a range of issues the industry has been battling for some time, such as driver and labor shortages, not to mention the high gas prices as of late. Today, there is a range of new challenges, compounded by the lingering events of the pandemic and higher fuel costs.

These factors boil down to several key areas:

Increased Volume
New Storage Challenges
Challenges with Materials & Supply
Air & Sea Freight Cost Volatility
International Port Delays
Continuing Driver & Labor Shortages

It is important to remember that many of these challenges are beyond the control of the relocation and household goods (HHG) industries. So let’s dive into today’s major challenges facing the household goods transportation industry.

Increased Household Goods Move Volume

Move volume is up across the industry, an increase over currently elevated levels that have been present for the past year. Corporate relocation volume is up over 2022 and has been approaching pre-pandemic figures from 2020 and 2021.

Additionally, U.S. military moves have been restarted, accounting for a large portion of typical HHG traffic. Previously, these moves were on hold throughout 2020, with few exceptions for emergency or national security moves. As a result, military relocation volume has suddenly jumped, nearing its typical summer volume.

COD/Consumer business

Volume began to skyrocket in 2020, with consumers deciding that they wanted to make significant life changes during the pandemic. This was accelerated by work-from-home policies, with companies allowing their workforce to live and work from anywhere with an internet connection.

Due to increased demand, COD pricing has become elevated. This increase in consumer pricing will continue to harm those relocating employees that are provided a lump sum benefit in place of a comprehensive relocation package. Their moving budget will no longer stretch as far as it may have in previous years, placing these transferees in a tight spot.

Heightened increases in consumer moves have caused a resurgence of “rogue movers,” fly-by-night moving companies who prey on individuals looking for cheaper moving options. This increases the risk that transferees who receive lump sums as their sole relocation benefit may fall victim to similar scams as they try to conserve their funds for moving.

HHG Storage Challenges

Household goods storage capacity is not something that the industry worries about very often. As a result, few in the business today have encountered it before. Well, hello, summer 2022, we’ve got ourselves a shortage of storage!

Storage Capacity for Personal Property

HHG shipments that required storage options have declined for more than a decade. In the past, the real estate market was well balanced, and most shipments were delivered directly to the transferees’ new homes, bypassing the need for storage entirely.

This decline in storage needs pushed many in the industry to downsize their warehouse spaces to lower overhead costs, shifting to smaller, less costly facilities.

Today’s red hot real estate market has caused an increased overlap rate for the typical transferee’s relocation timeline. In 2022, homes are still selling quickly, forcing employees to move out sooner than anticipated. Once at their destination, the highly competitive market prevents employees from finding suitable housing promptly. It has become common for homes to be sold before the family can even view the property. This translates to extended stays in temporary housing for the family while their household goods are put into storage until a home can be secured. While many around the country expect the real estate frenzy to cool off, there’s no way to level out numbers until that happens.

Additionally, some shipments must be stored further away from the transferee’s ultimate destination, leading to potential costs beyond what would typically have occurred with a closer storage facility.

HHG Labor Constraints

Storage in transit deliveries for corporate relocations is typically handled by local labor that the local destination agent arranges. The existing labor shortage that the industry has been dealing with has been compounded by the effects of the pandemic, further restricting supply. This limited labor pool specifies the development of creative solutions for operating trucks.

Materials & Their Impact on Household Goods

As many have seen in the news, the cost of simple building materials at your local hardware store has almost quadrupled over the last year. This is another excellent example of supply and demand playing out in real time.

Lumber

The cost of lumber is up, spiking as high as 347%! Primarily, this has impacted the housing sector, with builders and consumers taking a hit on the cost of new builds. In addition, the household goods and storage industry has dramatically increased the cost of 3rd party crating.

Additionally, as new storage vaults and warehouses are being built/bought to meet demand, higher costs, limited availability of materials, and a slower building pace result.

source: tradingeconomics.com

Corrugated Cardboard

The ideal packing material for most household goods moves, the cardboard box, has been steadily increasing in price for a decade now, thanks to the rise of the eCommerce and flat-pack furniture giants.

Costs have continued to rise in concert with the rise in demand for household goods. However, there is good news – While the price is rising, supply currently appears to be meeting the demand for packing materials.

Fuel Costs

Another newsworthy item is extremely high gasoline costs have risen in recent months, exemplified by the interruption of supply pipelines on the East Coast. As a result, clients have raised concerns regarding gasoline prices and how this would translate to HHG move costs. However, the rise in gasoline costs does not directly correlate to the price of diesel, which the household goods industry runs on.

Most household goods transportation equipment runs on diesel and not gasoline.
Diesel pricing was rising until February and has leveled off considerably since then.
There are fuel surcharges on all interstate HHG moves, a process that has been in place for over two decades.

Fuel surcharges are determined by the average price of a gallon of diesel as calculated by the U.S. Department of Energy on the first Monday of every month. The new fuel surcharge (if a change is required) goes into effect for shipments loading from the 15th of that same month through the 14th of the following month. This helps to level off any volatility in fuel prices.

HHG Air/Sea Freight Pricing Volatility

Supply and demand have caused air and sea freight pricing to remain volatile around the globe. This has been compounded by the overall reduction of flights, leading to limited availability to air freight transport. However, many in the industry are hopeful that we’ll be back on track within the next 12 months.

Also, lift vans, a typical wooden container used in international shipping, are in short supply. These containers wear out over time and need to be replaced. However, with the ongoing lumber shortage, replacements are more costly and more challenging to come by.

Continuing HHG Driver & Labor Shortages

Driver and labor shortages continue to plague the moving and storage industry. The HHG industry has made sustained attempts to attract talent with varied results. The uptick in volume and the increased costs of doing business have led to a more acute awareness of these shortages. As a result, the industry has explored the need for alternative modes of transport (such as small containerized shipments) and continues to utilize these methods.

What Can Companies with Household Goods Shipments Do?

Many of the relocation industry’s HHG transportation challenges are simply out of anyone’s control. Simply put, TIME has become the critical factor for many of these challenges. It will take time for these issues to unravel themselves:

Material supply will catch up with demand
The housing market will cool which will lessen storage demand
Over time, international ports will catch up with their backlog

However, for companies that need to relocate their employees, time is a powerful ally. Now, more than ever, companies should work to initiate their employees’ HHG services as early in the move process as possible.

This will allow your relocation team to set the right expectations upfront and help ensure your employees arrive at their destination as quickly as possible, ready to work.
The earlier companies can initiate relocations for their transferees, the sooner HHG services can be scheduled and coordinated.
The more accurately a transferee can project their final move date, the more quickly the move can be added to the list of summer moves.

GMS Is Prepared, Let's Talk!

Do you have questions about the household goods industry? Let’s talk! Global Mobility Solutions (GMS) is a leader in global workforce mobility. We help companies build and operate competitive relocation programs for talent acquisition and retention strategies.

Our goal is to make every relocation experience smooth for those moving. Our services can help every step of the way, from pre-decision, to moving day, to getting settled in the new destination – GMS is here for you.

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Tags 2020, 2021, COVID, HHG, household goods, household goods transportation, industry, pandemic, trends, update

Global Mobility Global Relocation Global Relocation Tips Household Goods Relocation Management

The Shipment of Household Goods

Post author By Ann Knapp | CRP, GMS, CMC
Post date September 14, 2021

moving box with label — Black fragile symbol on cardboard box

Shipment of Household Goods Explained

When planning a family move or relocating for a new job, one of the main points that may come to mind is how to move everything in one’s home. Looking around the house to take stock of your many possessions can cause stress. From clothes to dishes, artwork to vehicles, office equipment to bedroom furniture – decisions must be made on what stays and what goes. Working with a reliable moving company that can promptly and safely pack, and then move your household goods can make that process easier.

What are household goods? While there is no exact definition, household goods (commonly abbreviated as HHG) are most often referred to as a mix of items, utensils, clothing, and furniture that reside in your house. Because there is such a wide range of what fits into the concept of “household goods” it can be difficult (mentally and physically), risky, and time-consuming for an individual or family to move on their own.

If the move is taking place because of a new job or a personnel transfer, many corporate relocation benefit packages include some form of provision for the shipment of the employee’s household goods. In many cases, the relocation management company (RMC) that is managing the employee’s move has access to a reliable HHG transportation company to perform the heavy lifting related to the move. Conversely, some organizations may leave their relocating employees to their own devices to find an appropriate moving company. In these situations, some limited financial support or reimbursement is provided to the employee once the move is complete.

Why You Should Use a Professional Moving Company

Let’s start by pointing out the obvious. If household items are not packed by professionals there is a risk of items being broken or damaged upon delivery. Companies that specialize in household goods shipping can properly pack items to assure reduced risk of the item being broken. Many reliable moving companies will also have insurance for items if something is broken, damaged, or misplaced. In fact, eligibility for shipment coverage may be predicated on the movers performing the complete packing of the household goods.

It is also worth stating that if the relocating employee attempts to pack, move, and transport their household goods in a rental truck, there runs a risk of serious injury. The movement of larger items, improper lifting techniques, and repetitive movements can lead to an injury. This may impact the timeline of the relocation, or possibly result in a workers compensation claim if the move is company-sponsored.

Another fact that many might overlook is the transfer of these personal goods to the new city or state. Traveling cross country in an unfamiliar truck or pulling a trailer is not easy, and can take more time than many might realize. If the relocation is international, the logistics become increasingly complicated and out of the reach of the majority of transferees.

Allowing a professional moving company to pack, handle, and ship the employee’s household goods is more time-efficient. Every relocation consists of many moving parts. Stressing about the packing and moving of the transferee’s household goods doesn’t need to be a complicating factor. Additionally, if moving for a new job or position, there might be a short timeframe in which the relocation has to be completed due to a job start date. Hiring a moving company can help ensure that the household goods are moved quickly and will not hold up the relocation.

The Networks That Support Household Goods Shipping

Unlike the local movers many might think of when discussing moving, relocations generally occur over great distances. The van lines that are contracted to perform these types of moves will use larger trucks and a sophisticated logistics network to move the goods across the nation, or even around the world. Components of this network will include semi-trucks, train/rail cars, airlift vans (special containers for air shipments), and even ocean containers loaded onto vast ocean-based vessels. These networks are used to consolidate shipments and speed the overall transportation process. Commonly, local agents of the transportation company on both sides of the move will be called upon to assist with the loading and unloading process.

Additionally, specialty companies may be called in to perform special crating services, remove and package wall-mounted televisions, prepare sensitive items for transport, or even ship your automobile. Storage solutions are also on tap in the event you need temporary storage at your destination while you find a home, or if you are on an overseas assignment.

Lastly, animal shipments are a commonly overlooked necessity for those relocating. Pets are more than just animals, they are beloved members of anyone’s family. As such, specialized animal transport companies help to ensure the transferee’s pets are traveling under safe conditions. Transporting pets can require additional documents, immunizations, quarantines, and specialized kennels/crates. Transportation methods geared towards animals significantly reduce the amount of stress on the pet as well as instill confidence in the employee’s knowledge that their beloved family member is being well-cared for.

Why You Should Use a Corporate Relocation Company

Working with a corporate relocation company like Global Mobility Solutions can help reduce the stress of household goods shipping. We provide access to our vetted, certified, and highly competitive network of household goods specialists. By including HHG services in a thoughtfully designed relocation policy and moving process, you can ensure that your transferees arrive at their destination on time and with as little distraction as possible, ready to focus on their new position. GMS can be contacted as early as today to discuss the shipment of household goods to any location in the world.

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Tags household goods, household goods transportation, Relocation Household Goods Movement, shipment of household goods

Domestic Relocation Tips Household Goods Relocation Best Practices Relocation Management

Household Goods Moving & Transportation Management Trends

Post author By Ann Knapp | CRP, GMS, CMC
Post date April 27, 2021

man carrying moving box — Delivery man is ringing the bell to deliver two cardboard boxes. He's wearing a face mask and protective gloves.

Household Goods Moving Trends Continuing to Adapt to COVID-19 Pandemic Requirements

Moving industry trends in 2021 will see a continuance of the van line and household goods moving industry’s robust response to COVID-19. The pandemic’s immediate and broad impact has been met with effective solutions to help keep everyone safe during the entire moving experience. These solutions include:

Virtual surveys to document the contents of homes. These surveys help ensure greater accuracy for moving estimates relating to goods being moved, the time required for packing and moving, and labor requirements for the job. Many customers prefer these surveys, and the industry strives to use this technology wherever possible due to its convenience and degree of accuracy.
Even after effective vaccines are distributed, the industry will continue to use virtual surveys for the great degree of convenience and accuracy they provide. Also, many of the other helpful and healthy practices will remain in place to ensure continued safety for both our employees and our customers. These measures will provide peace of mind throughout the moving experience.
As the virus continues to rise in certain areas, providers stay informed and will reinforce all of the measures in place to ensure safety. For 2021, providers will continue to follow all of the COVID-19 business continuity plans they put into place in 2020. These plans include the use of appropriate personal protective equipment, face masks, social distancing, cleaning supplies, hand sanitizer, and fresh supplies of packing materials.
The industry expects drivers may be in line just after healthcare workers to receive vaccinations. Drivers are often in contact with the general public and are constantly moving, so vaccination would be a great way to further reduce any possible virus transmission.

What's Trending in Workforce Mobility for 2021?

This article is an excerpt from our 2021 Workforce Mobility Forecast. Download a complete copy today, or watch a recording of our latest Thought Leadership Series webinar on the trends that are shaping the industry.

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GMS Experts Are Here to Help

GMS is a leader in the relocation industry and keeps track of the latest household goods moving trends. Our certified relocation team can help you with any of your corporate relocation needs and provide you with the latest information related to mobility in today’s rapidly changing environment. We can assure you that all of our partners are moving household goods with safe and healthy procedures. Let us help you handle moving your employees, get in touch with us today!

Tags household goods, household goods transportation

Many household goods shipping companies are investing in air travel

Ocean Freighters Turning to Buy Air Planes

How Increased Airfreight Will Affect Global Mobility & Relocation Industry

Ready to Calculate YOur Program Savings? Request Access Now!

The HHG Industry & The Summer of 2022

Increased Household Goods Move Volume

COD/Consumer business

HHG Storage Challenges

Storage Capacity for Personal Property

HHG Labor Constraints

Materials & Their Impact on Household Goods

Lumber

Corrugated Cardboard

Fuel Costs

HHG Air/Sea Freight Pricing Volatility

Continuing HHG Driver & Labor Shortages

What Can Companies with Household Goods Shipments Do?

GMS Is Prepared, Let's Talk!

We're Here to Help! Request a Courtesy Consultation

Shipment of Household Goods Explained

Why You Should Use a Professional Moving Company

The Networks That Support Household Goods Shipping

Why You Should Use a Corporate Relocation Company

We're Here to Help! Request a Courtesy Consultation

Household Goods Moving Trends Continuing to Adapt to COVID-19 Pandemic Requirements

What's Trending in Workforce Mobility for 2021?

GMS Experts Are Here to Help

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