Maersk announces $500 mn investment to boost Southeast Asia's SC infra

Maersk, also known as A P Moller-Maersk, has unveiled plans for a substantial investment exceeding $500 million to fortify its supply chain infrastructure, with a particular focus on facilitating Southeast Asia's ascent as a global production centre and a significant consumer market. Over the course of three years, Maersk's investment initiative will primarily target its Logistics & Services division, while concurrently directing a substantial portion toward bolstering its Ocean and Terminals infrastructure. This strategic investment is anticipated to generate employment opportunities for local talents, enhance automation efficiencies, and expand the company's existing network footprint in the region. The announcement was made during a recent global executive board meeting held in Singapore. The objective of this investment initiative is to cultivate supply chain resilience, reduce trade costs, which can be 2x-3x higher in specific Asian markets, and deliver value-added outcomes to its clientele. Maersk's investment will concentrate on scaling its warehousing and distribution capabilities by up to 50% across the region, augmenting its capabilities in ocean, air, and land transport to cater to both international and domestic markets. By 2026, Maersk envisions adding nearly 480,000 sqm of capacity spread across Malaysia, Indonesia, Singapore, and the Philippines. These strategic investments will enable Maersk to serve its customers more effectively through strategically located mega distribution centers that are sustainable and equipped with advanced automation to optimise operational efficiencies. Notable among these investments is the development at the Port of Tanjung Pelepas in Malaysia, poised to become a pivotal integrated logistics hub with multi-modal connectivity, simplifying domestic supply chains and global connections. Additionally, Maersk is committed to expanding landside warehouse capacity at Singapore's Changi Airport, reinforcing its position as a key regional air freight hub. In terms of landside connectivity, Maersk plans to significantly increase its haulage truck capacity in Southeast Asia, offering eco-friendly solutions based on customer preferences. The company will pilot biodiesel-based haulage trucks and introduce electric vehicle trucks by 2024. On the ocean and terminal front, Maersk will continue its investments to expand infrastructure across the region through APM Terminals. This expansion aims to support optimised ocean network design and introduce additional transhipment capabilities to the region. Furthermore, Maersk is collaborating with regional authorities to explore opportunities for building green fuel infrastructure, aligning with its commitment to support a future fleet of environmentally friendly vessels.