THE NUMBER of telematics-enabled shipping containers in the global fleet is forecast to grow sixfold over the next five years, according to the Container Census & Leasing Annual Review & Forecast, published by Drewry.
These smart containers are to account for 30% of the global box fleet by 2027. According to the report, this increase will be driven by wider adoption across the dry container fleet.
Drewry defines a smart container as one fitted with a telematics device that provides real-time tracking and monitoring.
The pace of adoption of smart containers is expected to accelerate over the next five years as device costs fall.
The report says there are several factors driving this market growth.
“Supply chain disruption and port congestion that plagued the pandemic era, provided a wake-up call for improved visibility of cargo flows and container fleet management,” the report says.
“And despite weak market conditions, carriers have funds to invest following the recent boom in industry profitability and see opportunities to improve the efficiency of their operations through the deployment of smart containers.”
Drewry estimates that by the end of 2022 around 5.6% of the global container equipment fleet was fitted with smart technology devices following growth of 57% through the year; an acceleration from the 32% gain recorded the previous year.
Uptake of smart devices varies by equipment type. The report says penetration is already strong in reefer containers and land-based intermodal container fleets, but much lower in the dry box sector.
Already more than half of both the maritime reefer and land based intermodal container fleets are smart enabled, the former up from a third last year, according to Drewry estimates.
Drewry forecasts that the number of smart containers in the global fleet will accelerate over the next five years, to reach over 10 million units, representing as much as 30% of worldwide box inventories.
Smart fleet acceleration will now be driven by strong uptake in the dry container fleet where penetration is currently as little as 0.7%, according to the report.
Several carriers including Hapag-Lloyd and ONE have publicly committed to equipping their entire dry box fleet with smart devices.
Drewry said these moves will force other leading carriers to follow suit.
“Shipping line return on investment will come from the potential to optimise their box fleet and cargo operations,” the report says.
“Past initiatives to develop the dry smart fleet failed because they relied on BCO demand which was deterred by additional fees and lack of integration into carrier IoT service offerings.
Furthermore, digitising their container fleets will enable carriers to better control maritime supply chain information flows, enhancing their cargo visibility offering and so tethering BCO clients into longer term contractual commitments. They face increasing competition from alternative tracking solutions such as removable devices or predictive analytical tools. But to achieve this step change will require further investment to integrate smart containers into carrier IoT systems and collaboration among industry stakeholders to enable data sharing, particularly between carrier alliance and VSA partners.”
