Charting A Path to Maritime Success, Sustainability

Q: How did MSC successfully establish itself as the world's biggest maritime transport line? 

A: MSC's 53-year history is marked by consistent, organic growth in collaboration with its customers. This unusual growth, compared to others in the industry, is attributed to the trust customers place in MSC, as we grow hand in hand with them. This is how we went from operating a single vessel in 1970 to becoming the world's largest shipping line by 2022. MSC remains loyal to its strategy and customers, which has allowed us to gain our customers’ support and become the world's largest maritime company in January 2022. MSC stands apart thanks to: 

• 23 million TEU transported annually

• 730 ships and one of the youngest fleets in the world

• One aircraft and three additional ones ordered by the end of 2023

• 260+ sea routes

• 520 ports

• 70 own terminals

• 675 offices in 155 countries

Q: How has MSC harnessed cutting-edge tools and emerging technologies to deliver innovative solutions and enhanced value to its customers? 

A: Due to the pandemic and geopolitical conflicts, we have been compelled to invest more in digital solutions, resulting in various products that enable us to provide more personalized services. Our goal is to be a personalized service company with a strong digital touch, not just a digital company with a hint of personalization. We are actively promoting the use of electronic bills of lading (eBL) and exploring AI for operational improvements. We also offer platforms like MyMSC for nearly all online operations, including e-bookings and e-shipping instructions. While we embrace digital technology, we understand that in logistics, unforeseen challenges can arise so we maintain our human touch. When issues arise, our customers know they can always pick up the phone and a person will be available to help resolve any challenges.

Q: What strategic approaches has MSC formulated to effectively manage unforeseeable phenomena, especially in port operations, and still provide high service standards? 

A: Challenges can arise from natural disasters, climate change, wars and pandemics. The key is adaptability. During the pandemic, we took an unconventional approach by heavily investing in more assets to meet the shifting demands of our customers. This investment contributed to our strong growth over the past three to four years. We believe in long-term investment and short-term adaptability. Whether it is a pandemic or the congestion of the Panama Canal, we ensure we have the right resources in the right place and the flexibility to adapt quickly to complex scenarios. Maintaining this adaptability is crucial, so our customers can trust that MSC is a global company that can assist them no matter what challenges arise. MSC is always there to address our customers' needs and adapt to unforeseen circumstances.

Q: What was MSC's experience during the mandatory shift from Mexico City International Airport (AICM) to Felipe Ángeles  International Airport (AIFA)? 

A: When we understood and accepted that the transition would be mandatory, we did not wait until the deadline. We were among the second or third carriers to confirm our readiness to operate at AIFA because we decided it was better to be among the first rather than the last to adapt. We have been successfully operating at AIFA since July 7. 

One advantage of our recent entry into air cargo in January is that we were not as tied to the AICM as other airlines may have been, allowing us to be more flexible with the AIFA transition.

MSC Aircargo, with the aim of offering more capacity to the Mexican market, has been operating since September to new destinations, such as Chicago, Milan and Narita, on our brand new 777x fleet.

Q: What strategies has MSC initiated to attain its 2050 net-zero decarbonization objective? 

A: For MSC, sustainability is a commitment present throughout our business strategy.

We have several sustainability and decarbonization pillars. First, we made a significant investment in a new fleet, receiving 14 new vessels this year from the Celestino Maresca series. These ships break size records with a capacity of over 24,000 TEUs and their greater capacity reduces the CO2 impact per handled container. These vessels are also the most modern and efficient in the world, featuring engines capable of using bunker fuel, biofuels and alternative fuels.

We also support the development of new fuels like methanol, hydrogen and other biofuels. We have an agreement with DB Schenker, where for every 12,000t of biofuel they purchase for transportation, we save 35,000t of bunker fuel. This agreement is a significant step toward carbon neutrality. Our goal is to achieve carbon neutrality by 2050 or even earlier if possible. Renewing our fleet with new ships also means retiring older vessels, ensuring we maintain a modern fleet.

Our Journey to Net Zero has already led us to massively increase the energy efficiency of our fleet by more than 40% since 2008 and our newbuilds entering the water in the coming months are the most efficient by design. We are confident that our new orderbook, partnerships, fleet improvements and significant investments in new technologies will allow MSC to be fully compliant with international emissions regulations despite no net-zero fuels available at scale. 

Q: How can intermodal transportation serve as a resource to combat climate change and address the increasing demand for nearshoring? 

A: Globally, we have heavily invested in intermodal transportation, including trucks and trains. The latter is the most efficient and environmentally friendly way to transport containers. In Mexico, we are pursuing agreements with transport companies operating electric trucks and, simultaneously, promoting increased train use. We are collaborating closely with the two main players, Ferromex and CPKC, to rebuild customer trust in the Mexican railway system. Our goal is to reduce emissions by using trains while also providing logistical benefits to the country, especially as Mexico faces a general shortage of trucking capacity.

Q: How has MSC addressed the existing infrastructural challenges affecting Mexico?

A: In Latin America, it is precisely Mexico that is best positioned to attract foreign investment for production under the nearshoring model. For this reason, we consider it important to continue with the development of port, road and railway infrastructure and, in parallel, to work on improving the processes that speed up the flow of goods.

One of the great challenges is to increase the use of the railway and its intermodal service, since it can allow the country to have better planned logistics, especially in a panorama in which external conditions or contingency situations permeate the availability of transport. There are some important issues such as the lack of operators, imbalances in import and export corridors and capacity linked to supply and demand. The automation and optimization of processes in ports, internal terminals and even shippers' and consignees' warehouses can be a factor that helps make the transportation flow in the country more efficient, which would greatly benefit capacity and generate greater balance between motor transport and rail service.

Lack of infrastructure is a complex issue. However, it can be addressed through the efficient management of the existing infrastructure. For example, Manzanillo port is expanding its terminals but still faces access challenges. We need collaboration among all stakeholders involved in cargo flow, including customs, port administration, port security and the entire chain to ensure safe port operations. The key is not just expanding infrastructure but making it operate efficiently and that is where trains, with their efficient access to ports, become crucial.

Q: Considering the growth of nearshoring in Mexico, what strategies has MSC implemented to cater to the expected surge in demand?

A: As a maritime company, we are ensuring that we can provide the capacity and frequency needed by customers. We anticipate seeing the results of this investment next year as we carry the machinery coming from both the EU and Asia. Higher demand will require adaptations, particularly in short-sea shipping to the Gulf, the East Coast of the US and the Pacific.

Furthermore, nearshoring and the expansion of production in Mexico will not only serve the US and Canadian markets but also provide an opportunity to leverage Mexico's existing global trade agreements. We believe this presents a promising opportunity for our company and the industry.

We monitor the direction of the economy, where the new nearshoring trends take us. In the case of Mexico, it also implies the attraction of investments from European and Asian companies that seek to establish themselves in a country strategically located between both continents and with easy entry to the US, which encourages the import and export of products, generating a constant flow of merchandise.

Q: How is MSC overcoming infrastructure limitations?

A: The future of logistics in Mexico is about expanding, growing and maximizing infrastructure efficiency. This includes addressing capacity issues, especially at border crossings, and leveraging maritime options. To achieve this, efficient port flow utilization is crucial.

The rapid influx of investment has outpaced Mexico's readiness, requiring quick adaptation. This needs appropriate policies for mobility, customs and regulations. We need to ensure we meet market needs with the right frequency and capacity, ensuring we remain a significant player not only in maritime but also in air and land transportation.

Q: What are MSC's plans for expanding its range of products and solutions in the Mexican and Latin American logistics market? 

A: Our focus has always been on the best interests of our clients and partners. At MSC, we are constantly looking for innovative solutions that allow us to offer the best possible service to our customers and partners, ensuring increased efficiency and assurance by knowing that all cargo can be delivered safely and on time. Being a company that facilitates operations that are a direct reflection of economic changes, MSC in the last two years of the pandemic focused on investing significantly in assets that force the growth of the company.

Next year, we plan to expand our services into promising areas, anticipating changes in demand for frequencies, routes and destinations driven by production.