Big Ship Creates Big Backlog

Big Ship Creates Big Backlog

When the Ever Given got stuck in the Suez Canal, its gigantic size became a gigantic problem.

To support an ever-expanding global trade, ship size has been increasing for decades. Today, the largest ships can carry between 18,000 and 24,000 containers.  A larger cargo makes perfect economic sense because the cost of shipping one container decreases as cargo capacity increases. However, when things go wrong, big ships mean big disruptions in an already strained global supply chain. It is estimated that the stranded ship held up 12% of global trade at an estimated cost of $9.6 billion a day. This financial and logistic threat, along with more elusive cost savings in the future, may signal the need for fresh ideas in global shipping.

 


Video Spotlight: The Ripple Effects of the Backlog


This post is based on The New York Times article, Why the World’s Container Ships Grew So Big, by N. Chokshi, March 30, 2021, and the YouTube video, Cargo Ship Freed from Suez Canal, but Shipping Backlog Could Last, by CBC News: The National, March 29, 2021. Image source: (c) Glow Images/SuperStock.

Discussion Questions:

1. Will the short-lived blockage have a major Continue reading

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Fisker’s Second Venture: Mass Production and Direct Sales

Fisker’s Second Venture: Mass Production and Direct Sales

March 27, 2021

Henrik Fisker’s first car company failed.  His second venture is going to be different.

Fisker plans to mass produce a more economically priced SUV in the electric vehicle market.  Like other car companies such as Toyota, he also intends to use contract manufacturing for production.

Like Tesla, Fisker plans to sell direct to consumers.


Video Spotlight: 


This post is based on the CNN article, Henrik Fisker’s first car company flamed out. He’s sure this one will work, by Peter Valdes-Dapena,  February 18, 2021, and the YouTube videos in the Spotlight. Image source: Herr Loeffler/Shutterstock

Discussion Questions:

1. What are the disadvantages of contract manufacturing for Fisker?  Advantages?

Guidance: Students will easily note the main disadvantage is quality control.  Capacity issues may also arise. If the contract manufacturer is handling BMW and Fisker, the manufacturer is likely more interested in keeping BMW’s business. Continue reading

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Maersk to Launch Carbon Neutral Cargo Ship in 2023

Maersk to Launch Carbon Neutral Cargo Ship in 2023

March 26, 2021

Maersk is the largest container shipping company in the world.  The company plans to launch the first carbon neutral cargo ship in 2023.  The company has plans to be carbon neutral by 2050.

The issue is that this new vessel will operate on methanol produced from sustainable biomass or renewable sources.  Critics point out that biofuels are not a scalable fuel solution at this time.

Mass adoption of biofuels may not be the answer given this would lead to water scarcity and threaten food security.


Video Spotlight: 


This post is based on the CNN article, Maersk has found a way to clean up shipping but there’s a catch, by Hannah Ziady,  February 18, 2021, and the YouTube videos in the Spotlight. Image source: Chris Troch/Shutterstock

Discussion Questions:

1. How could biofuel sourcing be improved without putting further pressure on water resources?

Guidance: Students should perform an internet search for information Continue reading

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