Dusseldorf The Ukraine war causes the first delivery bottlenecks in Germany. At the Volkswagen plant in Zwickau, work was suspended for four days this week. In Dresden, too, employees have to stay at home for three days. The production stop at the two Volkswagen locations is mainly due to the lack of cable harnesses that are manufactured by suppliers in the Ukraine.
After just a few days, the war in Europe made itself felt in the supply chain in the German car industry. But other industries are also likely to be affected by the lack of deliveries. An overview of the problem areas in logistics.
In just a few days, the groundbreaking ceremony for Europe’s largest hinterland freight terminal is to take place in the Port of Duisburg. The task of the “Duisburg Gateway Terminal”, which is scheduled to go into operation by 2023 at the latest: the handling of 100 freight trains a week from China.
In view of the Ukraine war, it is uncertain whether railway containers from the Far East will roll into the city in the Ruhr area in the near future. The rail connection from China’s east coast to the west has been interrupted there since Russian troops invaded Ukraine.
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There are currently conflicting reports about the northern route, which leads through Belarus, among other places. “Trains are still running there,” says a spokesman for Deutsche Bahn subsidiary DB Schenker, while others report interruptions. The Far East Land Bridge (FELB), a subsidiary of the Russian railway company RZD, does not want to comment on request.
>>> Also read: German companies stop doing business in Ukraine
In recent months, the rail connection had experienced a boom. Because container ships only started their journey from Asia irregularly and experienced enormous delays, many shippers switched to freight trains for urgent shipments. If these are now only partially absent, the supply bottlenecks could worsen again.
“China will have an interest in the route being put back into operation,” says a manager at the Port of Duisburg. “Beijing will certainly put pressure on Russian President Vladimir Putin here.” Containers are currently still arriving by rail.
Still. Because bypassing Russia and the Ukraine by train involves expensive ship passages. The so-called middle corridor, the “Putin-free route”, as it is called by freight experts, leads through the Caspian and Black Seas to Bulgaria. It may still be interesting for deliveries from China to southern Europe, but probably too cumbersome for a connection to the Ruhr area.
It remains unclear how long the northern route of the Iron Silk Road, which is said to be still in operation, will last. A manager experienced in business with Russia reports that Russian transport companies are very concerned. On the one hand, there are fears of cyber attacks that could put train connections out of service, for example, and on the other hand there could be serious obstacles to payment in the future.
problems in air transport
The invasion of Russian troops in Ukraine is also having an increasing impact on the air freight business. It is true that the country’s most important export items, such as grain or steel, are not usually transported by air.
Since the EU blocked European airspace for Russian airlines on Saturday evening, European airlines were asked to stop flying over Russian territory. Lufthansa reacted on Saturday and will no longer use Russian airspace for the next seven days. Russia, for its part, responded with airspace closures.
This has consequences for freight traffic. Both the freighters and the passenger planes, in whose bellies goods are also transported, have to be diverted. According to a spokeswoman, Lufthansa Cargo is working on alternative scenarios in order to fly around Russian airspace to the south. “As a result, adjustments to the flight plan are unavoidable.”
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The Russian air freight airline Volga-Dnieper is also concerned. The transport airline, which is also based at Halle-Leipzig Airport and became known worldwide for its ten spectacularly large Antonov 124 freighters at times, is likely to face considerable challenges. Most of its other 25 Boeing 747, Boeing 737 and Boeing 777 freighters, which it operates through its subsidiary Air Bridge Cargo, are registered in Bermuda with the country code “VQ-B” for tax reasons. However, the managing company is based in Moscow.
It is therefore subject to the delivery stop for aircraft spare parts, which is planned as part of the sanctions against Russia. The associated flight cancellations, in turn, hit a large corporation from China: Amazon rival Alibaba is one of the main customers of Volga-Dnieper.
Truck driver shortage is expanding
Restrictions are also to be expected on the road. The war in Ukraine has exacerbated the lack of drivers already complained about by many transport companies. Problems are caused by subcontractors and company subsidiaries from Poland and Lithuania, which have so far made a significant contribution to the transport of goods in Germany. The German truck transport company Hegelmann controls a large part of its 6000 trucks from the two Eastern European countries. The Girteka Group in Vilnius, Lithuania, is also one of the largest truck freight providers in Western Europe.
However, since the Russian invasion, the companies have lost their employees. “103,000 Ukrainian drivers are employed by Polish transport companies,” says Frank Huster, general manager of the forwarding association DSLV. “A further 22,000 come from Belarus.” For comparison: there are just 572,000 drivers employed throughout Germany.
Thomas Hansche, spokesman for the Federal Association of Logistics and Transport (BLV-pro), fears: “Now in the event of war, these drivers will drive home to help their families or to do military service.” Many would have already with the first reports of hostilities Drivers immediately stopped work, confirms a freight exchange manager.
Customers reported that drivers simply parked their trucks on the side of the road and left the key at a gas station in order to return to their families as quickly as possible. In addition, adult Ukrainians of working age are currently no longer allowed to leave the country due to mobilization.
The BLV expects “English conditions” in Germany as a result. A year ago, the supply of supermarkets and petrol stations collapsed on the British Isles after the government expelled Eastern European employees from the country as a result of Brexit.
Ship calls to Ukraine stopped
There is also a risk of staff shortages in shipping. According to calculations by the International Chamber of Shipping (ICS), 14.5 percent of all seafarers come from Ukraine and Russia. Bottlenecks are programmed because on Friday Ukraine prohibited all men up to the age of 60 from leaving the country due to national defense.
At the same time, the container shipping companies Hapag-Lloyd, Maersk, CMA CGM and MSC stopped calling at Ukrainian ports. Bookings for the destination port of Odessa are not possible, said the French shipping group CMA CGM. There, the Hamburg-based terminal operator HHLA sent its 480 employees home at the beginning of the war.
Most container ships are now diverted to the Romanian port of Constanta, Tripoli or Piraeus. “Especially in Greece there are already the first traffic jams,” reports DSLV expert Huster. The good news is that this is unlikely to have any impact on Germany.
bottlenecks in agriculture
War and sanctions could also lead to drastic bottlenecks in agriculture. With its fertile farmland, the Ukraine is considered the “granary of Europe”. Most recently, the country brought in a record harvest of 33 million tons of wheat. Most of the planned exports of 24 million tons have already been delivered. However, the war threatens to massively endanger sowing and harvesting this year.
“It can be assumed that these deliveries will fall dramatically – either through Russia’s political will, through regional destruction or simply through sanctions from the West,” says Thomas Böckelmann, Managing Director at asset manager Euroswitch.
If there were extensive crop failures in the summer due to the war, for example wheat from Ukraine, this could trigger famine, especially in Africa. Many countries there cannot support themselves and are dependent on food imports. The world’s poorest cannot pay for extremely expensive agricultural products.
Collaboration: Larissa Holzki, Katrin Terpitz, Bert Fröndhoff, Stefan Menzel
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