trends in international moving terry r. head president – international association of movers
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Trends In International Moving Terry R. Head President – International Association of Movers. Who / What is IAM ?. The largest international trade association & advocacy group for household goods forwarders, movers, removal companies, logistics & service providers - PowerPoint PPT PresentationTRANSCRIPT
Trends In International Moving
Terry R. HeadPresident – International Association of Movers
Who / What is IAM?
The largest international trade association & advocacy group for household goods forwarders, movers, removal companies, logistics & service providers
Membership includes 2,400+ companies & individuals in more than 170 countries and territories
Founded in 1962 to represent the interests of military TSPs (Transportation Service Providers); scope broadened to include commercial business in 1970s
Annual Meeting and EXPO is world’s biggest & best networking opportunity for business development in moving industry
IAM and Its Affiliates
Is FLAT the New UP?
FLAT seems to be the “New Normal” USA Economy neither up or down – Since 2009 Recession - economy has struggled
to gain momentum Growth held back by higher Federal Taxes &
government spending cuts 2013 - USA Economy grew at lackluster 1.9 %
versus 2.8 % in 2012 2014 projected at 2.4% (recently revised to 3%)
United States - Economy
USA Housing Trends ? Unlimited number of opinions, but common
themes; and one thing is certain:
In the USA - Housing drives Moving 2013 – Prices increased by 10.9% - highest level
in four years (Median Price up $30,000)
Home sales expected to remain FLAT in 2014 Inventory UP, with less competition from
investment buyers: Is this what drove markets up? Record low interest rates going away &
affordability worsening
Curious Facts About Moving in the USA
Every year more than 45 million people relocate in the USA – (about 17% of population)
On average – 11 or 12 times in a lifetime About 6.7% move to another state 50% move due to job change, 33% due to
retirement & the rest for other issues Five years after graduating, 33% of young
people no longer live in same state
Source: Moving News
Local Move 41 %(Same City)
Long Distant 23 %(500+ Miles)
Moving to Another 19 %City (Less 100 miles)
Regional Move 17 %(Different Metro Area100-499 Miles)
GREEN = Nobody Lives Here
USA Census 2010 – Dark Green Represents Zero Population Blocks
Nobody Lives Here USA Census 2010 – Dark Green Represents
Zero Population Blocks
10 Least Affordable Housing Markets
1. Hong Kong
2. Vancouver
3. San Francisco*
4. Sydney
5. San Jose*
6. Melbourne
7. Auckland
8. San Diego*
9. Los Angeles*
10. London
Four USA cities – all in California
Source: 2014 Housing Affordability Survey
UK Housing Trends
UK Housing costs set to rise by up to 8% in 2014, with gains in all its countries
Average House price 247,000 Pounds Sterling
A growing imbalance between supply and demand
Estimated UK needs 100,000 new homes a year to keep up with demand
UK Economic & Trade Outlook
Bank of England forecasts UK Economy will grow 3.4% in 2014 (was 2.8% Nov. 2013)
On course to overtake Germany as Europe’s biggest economy within next two decades
Second most successful Western economy after USA; will slip down global rankings (6th) due to Emerging Markets – India, Brazil, Russia
Exports hit record levels – but so have Imports (UK can’t escape its trade deficit)
Source: Centre for Economic and Business Research (CEBR)
Trends in UK Talent Management
London is Top “HQ” Pick for world’s biggest companies
Two out of Five largest companies in the world with a Headquarters in Europe have it in London (60% of European Companies)
Nearly half of all highly-skilled workers in the top five European business cities are in London
Paris 19% - Berlin 13.7% - Milan 11% - Frankfurt 9.8%
What is an Expat?
Expat: an expatriate person transitive verb
1. to withdraw (oneself) from residence in or allegiance to one's native country
intransitive verb • 2. to leave one's native country to live
elsewhere; also to renounce allegiance to one's native country
Expats in the World: The Numbers
• There were 73 million expats worldwide in the year 1960; that figure now stands at a staggering 230 million
• Expats make up 3.1% of global population• Women make up 49% of expat population• There are 6.32 million American expats and
4.7 million British expats living abroad
Source: EasyExpat.com
Top Five Destinations for UK Expats
UK now Europe’s Biggest Exporter of PeopleOnly China and India have more citizens based abroad
UK Expats and numbers of British state pensions in brackets:
1. Australia 1,062,000 (251,000)
Held top spot for past two decades
Stricter Visa restrictions impacting that number
2. USA 829,000 (140,000)
3. Spain 808,000 (104,000)
4. Canada 608,000 (157,000)
5. Ireland 289,000 (126,000)
Source: inShare Expat Data Tracking
Global Economies Up, Down & All Around
BRIC Countries - Brazil, Russia, India & China Brazil – 4th year of disappointing growth
Big fall back to earth after last decade as one of the
leading Emerging Markets
Russia –Weaker domestic demand and delayed investment threatening growth
Annexation of Crimean peninsula –what’s next?
India – Asia’s third-largest, weighed down by high inflation, weak currency and drop in foreign investment
China - World’s second-largest economy, projected to grow at 7.5% in 2014 versus 7.7% in 2013
MINTS Next Economic Giants?
Mexico – Rapidly developing infrastructure (near-shoring of manufacturing), rising Middle Class, declining poverty rates
Indonesia – 4th most populous after China, India & USA
Mixed economy – Private and Public play role
Only G20 member to lower debt-to-GDP ratio Nigeria – GDP 3rd largest in Africa, behind South Africa and
Egypt (30th in the world; was 52nd in 2000) Turkey – 3rd largest growing economy in the world:
Construction related industries = 30% of economy
Very large consumption base and 3 Auto Manufacturing
companies
Why Focus on Trade and Global Economies?
Trade is to International movingas
Home sales are to Domestic moving
Why Companies Move People
Growth of Company Reorganization / Restructuring Promotions / Resignations Knowledge / Skills Transfer Expansion into New Territories Budget Constraints Tax Advantages or Disadvantages Acquisitions / Mergers
Source: Atlas Van Lines – 2013 Corporate Relocation Survey
M & A Generates Moves
Merger & Acquisition activity becoming major reason why companies relocate staff
63% of USA companies will initiate at least one acquisition or merger in 2014 – 36% as Divestiture
Industries expecting highest number of M&A activity:
Technology, Media, Telecommunications, Health Care, Life Sciences, Pharmaceuticals, Financial Services and Energy
Regions where M&A activity is likely:
USA 56%, Western Europe 29%, China 29%, N. America 27% and Asia (excluding China) 15%
Source: KPMG 2014 M&A Outlook Survey
WHERE will People be Moving to and from?
TOP TEN relocation destinations:
1.United States 6. India
2.United Kingdom 7. Germany
3.Singapore 8. Hong Kong
4.China 9. Japan
5.Switzerland 10. Canada
Source: UniGroup Worldwide UTS Migration Study
Changing Customer Demographics Younger employees willing to take on overseas postings, particularly
in emerging markets
More ‘split-family’ assignments
Many companies combining overseas jobs with charitable projects
IBM – 1,200 employees – 100 projects – 23 countries FedEx – Global Leadership Corp. works with Peace Corps
Relocation trends showing shorter time periods for international assignments and short-term projects
Probably smaller shipments – Average shipment size dropped from 7,500 lbs to 5,550 lbs.
Dawn of the “NANO-Shipper” (Customer) – Everything they own is smaller / digitized – they just don’t have as much stuff!
Length of International Assignments
12 Months or less 13%
More than 12 months,
less than 3 years 54%
3 Years or More 33%
Source: Atlas Van Lines -2013 Corporate Relocation Survey
In What will People Be Living?
With trends for postings to be shorter and for more assignments to emerging markets, what will we see?
Long Term or extended stay hotels/temporary housing
Serviced (semi or fully) furnished apartments Rotation in and out of corporate housing Pre-Packaged Home Furnishings
WHERE are People Moving …or not?
Five-Year Trend (Inter-Country Moves): USA and UK continue to hold onto first and
second place China is third, followed by Germany Both countries showing a slowing or flat trend in
relocations from USA Switzerland and Singapore – remain strong due
to financial firms rotating staff India, France and Hong Kong – Gone flat and
barely holding onto their previous slots
Source: CARTUS, Global Relocation Destination List
What Percent of USA Employees
Relocate to Each Country?
U.K24%
Germany16%
China12%
Australia 6%
France6%
Switzerland5%
Netherlands5%
Japan5%
India4%
Singapore4%
Malaysia3%
Brazil3%
Belgium3%
Italy2%
Israel2%
U.KGermanyChinaAustralia FranceSwitzerlandNetherlandsJapanIndiaSingaporeMalaysiaBrazilBelgiumItalyIsrael
The JOBS are Moving! Re-Shoring & Near Shoring Reversing 20-year trend of “Off-Shoring” Jobs
3 million Manufacturing Jobs will return to North America over the next 5 years
- Wages in China grow 15-20% a year, factor in lead times, shipping & inventory costs, currency fluctuations, etc.
- Cost differences will be only 10-15%
- Abundance of USA Fuel sources (Natural Gas) for factories
- Stable business environments - protect the Brand’s reputation
and less civil strife
WHERE is Corporate America Moving IN From?
TOP TEN Origin Countries – Inbound USA:
1. Germany 6. Australia
2. United Kingdom 7. The Netherlands
3. Switzerland 8. Japan
4. France 9. Belgium
5. China 10. Singapore
Source: UniGroup Worldwide UTS Migration Study
Trends in Airfreight
Technology shipments account for 50% of Airfreight Revenue in last 20 years
Volume of (high-tech) cargo down due to reduced size of product and products with more functions in single device creating less freight to ship
Airfreight Market will see slow, sporadic growth over next several years due to “modal shift”
Smaller HHG shipments may increase use of Airfreight or Unaccompanied Baggage
Trends in Ocean Shipping
Since 2011 ocean rates have seen unprecedented gyrations and remain under pressure
Supply/Demand Ratios should/will favor shippers Challenge = maintain rate levels and market share Carriers may try to manage capacity
• Skipping Sailings• Anchoring Vessels (Mothballing as in 2010)• Returning ‘Chartered’ Vessels
Consolidations, Mergers and Vessel-Sharing Increased Risk of Financial Distress (Bankruptcy)
Future Impacts on Ocean Shipping
Panama Canal Expansion in 2015 Larger TEU Vessels begin transiting Canal USA West Coast Ports will lose volume to Gulf
and East Coast Ports Bigger Ships = Bigger Mishaps/Cargo Loses =
Bigger Insurance Premiums
More Mis-declared Container weights
Impact on “General Average” ? Increase in “Round-the-World” sailings
Moving Over the North Pole
North Sea Routea.k.a “Northeast Passage”
New Shipping Lane from Europe to Asia North of Russia – Cuts off thousands of miles
and avoids transiting Suez Canal In 2010 just four (4) ships made the trip Since April 2014, 266 voyages have received
permission from Russia’s North Sea Route Administration
Similar increased shipping activity in the Canadian Northwest Passage
What is UP in Moving Government Regulations
Ports and Border SecurityFocusing on Personally Identifiable Information (PII)
CARB - California Air Resource Board
Tighter vehicle emissions restrictions
USDOT/ FMCSA - Increased Bonding Limits, Hours of Service(HOS), CSA, Medical Registrations, EOBR
Federal Maritime Commission (FMC)Increasing Bonds, OTI Vetting & Licensing Enforcement – particularly with “Middlemen” and Overseas NVOs
FMC/FMCSA – Cooperative Focus on Rogues
Combating Rogues
Use to be only a local or domestic issue – now impacting International Moving
The Internet is their hook to draw in uneducated consumers of moving services
Public – Private Cooperation is Key
FMCSA / FMC and a variety of industry entities
working hand-in-hand
Starting to turn the tide in North America
USA Government – Rogues Federal Motor Carrier Safety Administration – Protect Your Move
Federal Maritime Commission - I-27 investigation – “Barrel Trade”
– MOU – FMCSA and Federal Maritime Commission
– Enhanced – licensing process and bonding
– MAP-21 Highway Bill – increased bonding for forwarders and brokers – raised from $10,000 to $75,000
– Increased focus on international rogue movers
Coordinated effort – Consumer Protections and Education
– Trade associations, Federal, State and local (regulatory) agencies conducting “sting” operations to nab the scam operators – we refuse to call them rogue movers.
Industry Action - Rogues
American Moving & Storage AssociationAMSA administers professional certifications for specialists:
Certified Moving Consultant (CMC) & Certified Packer/Loader
(CPL); and Registered International Mover (RIM) PRO-Mover Program – Enhanced vetting of Members
Industry Action - Rogues Canadian Association of Movers (CAM) –
“Year of the Reputable Mover” Working through Provincial Ministries of
Transport – Federal Ministry of Justice and in cooperation with Canada’s Office of Consumer Affairs and the Canadian Competition Bureau
www.mover.net/trust
Is Space the Next Market? • Russia to begin Moon Colonization in 2030
• Which mover will handle first shipment of HHG?• Who will be first mover to have branch on the
moon? Will they be a member of BAR / IAM?
Will Rogues still be a problem?
THANK YOU!
www.IAMovers.org
@IAMOVERS SOCIALCAFE.IAMOVERS.ORG/home www.facebook.com/iamovers
WHERE People Will Be Moving –
North America Outbound
Fifth straight year United Kingdom was the Number 1 Destination
UK relocation traffic up 7.8% The Netherlands moved no. 10 to no. 7 Switzerland from number no.14 to no. 6 Germany down 14.6% in shipment numbers France down 21.7%
Source: UniGroup Worldwide UTS Migration Study
What is Down / Flat in Moving
• Drivers – Retention and Recruitment • Hauling Capacity – remains tight, get tighter• Pricing – Unhealthy emphasis on dollars and
cents...at the cost of Service• Profit Margins – Revenue Distribution • Agent Confidence – Forced to work with
‘Unknown’ bookers, haulers and TSPs• Ability to Forecast and Invest –