2nd Wave of COVID-19?
Tuesday, June 16, 2020
Businesses are opening back up and the market is responding. Summer is here and in full force as Americans start leaving their houses again. Global GDP has fallen 6% so far this year and 7.3% in the U.S. A second wave of COVID-19 would jump those percentages to 7.6% and 8.5% respectively.
The pandemic brings up a few threats to trade, particularly container shipping, because the U.S. and the rest of the world are wanting to bring outsourced companies back home. We need to prepare for COVID 19 to continue to make unpleasant waves in the industry. Economies across the world are having to change faster than ever before. The near future will definitely bring uncertainty and difficulty in preparing for the future.
We can look for companies to continue to innovate in the shipping world. New and improved ways of moving freight, such as adding drones to the fleet, will undoubtedly shake up the industry.
“By the end of 2021, the loss of income will exceed that of any previous recession over the last 100 years outside of wartime, with dire and long-lasting consequences to people, firms and governments,” warned OECD Chief Economist Laurence Boone in a statement published on Wednesday.
Gas prices through the pandemic have been helpful to companies that couldn’t take advantage of PPP loans, but as we head into summer we can expect gas prices to continue to rise. Carriers will be forced to raise prices for this reason as well as less drivers on the road due to 80,000 trucking jobs lost in April.
References: Miller, Greg. “COVID Second Wave Would Slam Ocean Shipping.” FreightWaves, 10 June 2020, www.freightwaves.com/news/covid-second-wave-would-slam-ocean-shipping.