Montreal: North American gateway of choice for Hapag-Lloyd

By: | Issue #639 | at 10:25 AM | Channel(s): Ports & Terminals  Ports  Liner Shipping  

Wolfgang Schoch, managing director of Hapag-Lloyd (Canada) Inc., is not shy about extolling the strategic hub role the Port of Montreal plays in the transatlantic trade of the German shipping line.

Wolfgang Schoch, managing director of Hapag-Lloyd (Canada) Inc.
Wolfgang Schoch, managing director of Hapag-Lloyd (Canada) Inc.

Interviewed in his Montreal office, he declared: “Montreal, in fact, is our most important port in North America, with more container throughput in 2015 than Los Angeles and Long Beach combined.” For Hapag-Lloyd, the transatlantic trade via Montreal and Halifax accounts for one fifth of its global container volume of 7.5 million TEU. And significantly enough, this Hamburg-based carrier utilizes Montreal as its main gateway not only for the Canadian market but also for the U.S. market.

“Nearly 50% of our export cargo via Montreal comes from the United States,” he said, pointing to such shippers as Ford, GM and John Deere.

One third of the import cargo transported by Hapag-Lloyd via Montreal has a final destination in the United States.

“In Montreal, we have a market share of 38%, and in Halifax it’s 24%,” said Schoch. “We became very strong in Canada after merging with CP Ships in 2005. Our first liner services to Canada go back to 1892.”

Hapag-Lloyd offers three services in Montreal as well as three services in Halifax.

Commenting on Montreal’s advantages, Schoch noted: “Montreal is a very fluid port. Dwell times in terminals are low. Between one and two days. This is competitively important when comparing to the US east and west coasts. Waterfront labor relations are stable, and price-wise Montreal is competitive with US ports.”

Schoch affirms “Montreal is unique (among world ports) in that you are loading and discharging the whole vessel. The cargo comes in and goes out very rapidly and fluidly. That is what the importers and exporters want.”

But Schoch also considers that further deepening of the St. Lawrence channels, beyond the current maximum draft of 11.3 metres (37 feet), should eventually be undertaken so that larger, post-Panamax vessels can call at Montreal fully loaded in order to reduce slot costs.

(Since May 2013, the Canadian Coast Guard has authorized post-Panamax type ships to sail in the Quebec-Montreal section of the St. Lawrence navigation channel. This would include 6,000 TEU container vessels, but none of this size has yet called at Montreal.)

According to Schoch, the current market does not justify introducing larger vessels than the Toronto Express and Montreal Express with nominal capacities of 4,400 TEUs. “But in the medium and long term, we want to grow as the market grows.”

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American Journal of Transportation