For major shipping companies dealing with trade wars and slowing global growth, conditions appear to have deteriorated for some as 2019 came to a close.
Global shipping and logistics provider Expeditors International said Friday that it expects fourth quarter operating income to fall between $177 million and $183 million.
CEO Jeffrey Musser cited trade disputes and slowing growth for a number of economies. The report comes a day after the railroad CSX reported a 7% decline in the freight it hauled during the final months of the year.
“We’ve seen impacts throughout the year from these market conditions, but the pace at which these changes occurred accelerated dramatically in the fourth quarter,” Musser said. “We know this environment will change over time, as it always has in the past.”
Shares of Expeditors International of Washington Inc., based in Seattle, slumped almost 5%.
Bruce Chan, an analyst at Stifel Nicolaus, said ocean-borne volumes and shipping rates have been weak for most of the past year but don’t appear to be getting dramatically worse now.
The drop-off at Expeditors may be isolated, Chan said.
“It’s a soft market and it has been, but I haven’t seen any major negative inflection” on volumes or rates for shipping and airfreight, Chan said. “What’s going on here is mostly related to how the company planned or budgeted for the fourth-quarter market environment and may have made a miscalculation” on how much capacity to lock down.