Maersk launches fully automated Singapore hub for e-commerce surge – Fast Blogs World

SINGAPORE – Even amid geopolitical tensions and shifting trade dynamics, global consumer demand for everyday goods has not wavered, with people still buying clothes and replacing broken appliances, said the chief executive of the world’s largest shipping line.

“Despite the noise out there, people are still sending their children off to school with a new backpack. And when the new Formula One season begins, many will find a good excuse to upgrade their TVs,” said Mr Vincent Clerc, chief executive of AP Moller-Maersk.

Mr Clerc was speaking at the opening of a fully automated global and regional distribution centre the size of around 20 football fields by Maersk in Singapore on March 18.

As online shopping becomes the norm, every click sets off a chain of warehousing, sorting and delivery operations to move vast volumes of goods quickly and efficiently around the world.

“Thanks to the people who work and deliver at sites like this, those packages arrive at doorsteps around the world every single day,” he said.

World Gateway II, a $200 million facility designed to help companies store and ship goods bound for the region from Singapore, will support both bulk deliveries to businesses and online orders to customers.

It will handle products including everyday goods, retail items, beauty and wellness products and appliances, as well as higher-value products such as pharmaceuticals and electronics.

Located near Singapore’s new Tuas Port, the 1.1 million sq ft facility will be customs bonded, where customers enjoy zero goods and services tax (GST) on warehouse storage. Import GST will also be deferred on non-dutiable goods until they enter the market, Maersk said.

The move marks the expansion of Maersk’s contract logistics and e-commerce capabilities in Asia-Pacific and comes after two similar facilities were launched in China and Malaysia.

Already 70 per cent filled, World Gateway II almost doubles Maersk’s total logistics capacity in Singapore to 2.2 million sq ft. It will employ around 500 people in operations, engineering and supply-chain management and analytics once fully operational.

The shipping line has operated a single one million sq ft regional distribution centre, World Gateway I, in Jurong West since 2016. Singapore is Maersk’s second-largest base worldwide outside Copenhagen, with more than 1,500 employees and over 140 vessels under the Singapore Registry of Ships.

“The centre of gravity for global trade is shifting towards Asia. We see it in the volumes moving through our networks every day,” said Mr Clerc.

He added that rising Asian brands, expanding consumption and more complex production patterns are reshaping trade flows, with companies redesigning supply chains to position inventory closer to demand and driving intra-Asia trade, which now accounts for about 40 per cent of global trade.

These shifts are also changing what businesses need from logistics providers.

There is greater demand for shorter lead times, inventory closer to cities and integrated sea, land and air solutions to respond quickly to demand spikes, he said.

Deputy Prime Minister and Minister for Trade and Industry Gan Kim Yong noted that the expansion of Maersk’s logistics business in Singapore reinforces the Republic’s role as an intermodal logistics hub, allowing high-value cargo to arrive here and be distributed efficiently across Asia via sea, air or land.

“It also strengthens Singapore’s position as a regional platform for e-commerce fulfilment and supply chain management,” said DPM Gan, who spoke as guest of honour at the opening of World Gateway II.

He added that recent conflicts, including the ongoing war in the Middle East, have affected key shipping routes and global logistics networks, causing trade flows to re-route and reorganise.

Singapore is therefore continuously investing to ensure that it has the capacity and capabilities to support evolving trade flow, such as through Tuas Port and Changi Airport Terminal 5, both of which are currently being developed.

Having the infrastructure alone is not enough, though. “To remain competitive, we must also strengthen the logistics and supply chain ecosystem,” said DPM Gan.

This includes advanced warehousing, regional distribution centres and supply-chain management capabilities that allow companies to handle higher-value goods and more complex supply chains, such as World Gateway I and II.

“They expand Singapore’s logistics capacity while strengthening our capabilities in automation, digital logistics and advanced fulfilment.”

Maersk’s second facility, which is expected to be among the most advanced warehouses of its kind in Singapore, will have the technology to automatically move, sort and pick small items typically found in e-commerce orders. It will also use robots that fetch boxes or bins from storage and move items around the warehouse as needed.

These systems enable faster order fulfilment, shorter lead times and improved accuracy by reducing manual handling, the liner said.

“This is the future of logistics,” said DPM Gan.