About Me

North East Coast, United States
I am a transportation executive and have worked in the container shipping industry for most of my career. I have experience in terminal operations, rail operations, vessel operations, liner management, and contract negotiation. I find myself always searching for something new to learn, as well as other professional opinions about different issues, obstacles, and changes with in the industry. I have searched for a forum to discuss these happenings with other professionals but have found none. For this reason I have decided to create my own. I will put up my opinions and hope for the blog to catch on, so I may read others.

September 17, 2008

Was it a mistake when many Financial companies bought shipping terminals?

I am very interested in the buying and selling of container terminals and terminal operators by large financial organizations. Companies such as AIG, Deutsche Bank and others have been investing in the Transportation industry by buying Terminals. The thought process being that the industry and container shipping is only going to grow and fast. Some thought of it as a quick flig (5 year) investment oportunity. This has not shown to be the case. Many people do not recognize that the transportation industry also fluctuates with the World economy and high-profit volumes can shrink in a poor market. The world market will always dictate the rise and fall of container shipping, both import and exports.
That being said, the industry is not doing poorly when comapred to the investment and mortgage firms out there. With many terminals not making the large sums as money as expected (but still being profitable) and now being a part of large investment conglomorats; Are they going to be sold? If an investment firm is losing money as a whole, what do they sell to make up for that? I would think they would sell a sector that is semi-profitable with growth potential, such as their shipping terminals. For example; AIG's High Start Capital is the parent company to Ports America. What are they going to do after being baled out by the US government. Are they going to sell to a Carrier company, another investment firm, or hold onto this infrastructure investment in hopes to make money.

The Global economy is so interesting to watch and learn about. Please add your comments and knowledge.

3 comments:

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