Maersk, the world’s second-largest shipping company, this week announced its decision to move its operations from the Port of Felixstowe to London Gateway. Changes will take effect from February next year.
Following a review of its Asia-Europe shipping routes Maersk has stated that London Gateway on the Thames estuary was "the most optimal port to serve our customers" in the UK. The decision to relocate reflects evolving priorities within the global shipping industry and the company has highlighted several factors that contributed to its move:
Efficiency and Modern Infrastructure: London Gateway, operated by DP World, has had over £1 billion of investment in recent years, with the go ahead for a new rail terminal which will further boost state-of-the-art facilities, including automated operations and deeper berths capable of accommodating the largest container ships in the world.
Proximity to Consumer Hubs: London Gateway’s location closer to London and the South East—key consumer and industrial markets—offers a strategic advantage in reducing inland transportation costs and emissions. For a company committed to net-zero shipping by 2040, this alignment with its sustainability goals was a critical factor.
Streamlined Logistics: London Gateway’s seamless integration with rail and road networks makes it an ideal hub for Maersk’s end-to-end logistics strategy, which emphasizes supply chain fluidity and multimodal transportation.
The Port of Felixstowe, the largest container port in the UK, is a key strategic asset in the East of England’s economy. About 2,000 ships call at Felixstowe each year, carrying about four million containers. Each week, about six giant container ships arrive at the Suffolk port on the Asia-Europe route - two of which are Maersk's. So this decision represents a significant reduction in deep sea container freight.
Maersk’s departure poses significant challenges for the port and the surrounding region. Maersk’s operations constituted a substantial portion of Felixstowe’s container volume. Its relocation will result in a reduction in throughput, impacting the port’s revenues and profitability. The move could potentially lead to job losses with layoffs among dockworkers, logistics personnel, and related service providers who depend on Maersk’s business. The ripple effects are likely to be felt across the local economy, from transport companies to small businesses supplying goods and services to the port.
Local businessman Mark Ling, agency director for ICE Transport haulage in Ipswich, told the BBC that the announcement by Maersk was a "big deal" but not "unexpected" due to the transport infrastructure issues around Ipswich that have held back progress, including regular closures of the A14 Orwell Bridge due to high winds, a lack of progress on the much needed Ipswich northern bypass, and underinvestment in freight rail with the route between Felixstowe and Ipswich operating on a single track.
It is hoped that other shipping firms will fill the spaces left when Maersk departs Felixstowe. But while there are many factors behind Maersk's decision, the move does underscore the importance of strategic infrastructure as well as the need for UK ports to adapt to changing industry dynamics. Investment in infrastructure, technology, and workforce skills will be critical for Felixstowe and other ports to remain competitive. At a national level, the government may need to reconsider its approach to supporting the maritime sector, balancing regional economic development with the growing dominance of ports like London Gateway. Maersk's focus on London and the Southeast market does not help the rest of the country.