BACK AND FORTH

management did not take the decision to nominate our tank container division as a core business alongside our freight forwarding activities as early as the 1990s. We have lost precious years of growth.

HCB: You have grown the business unit from the first tank container in 1976. How does if feel now that you are passing it on to the next generation?

HW: Even if I was not active in our tank container business from the very beginning, it has been more than 30 years that I have been active in the area, the last 20 of which as managing director. It was not that easy for me to hand over this responsibility but, with Maximilian Nause as my successor and Katrin Behrens responsible for the procurement of our fleet, the new generation is ready and has already proven itself.

We often continue to exchange ideas and my advice is sought but the decisions are no longer mine. It was and is important to me that this business represents added value for Leschaco - that has always been the case over the past 20 years and I am convinced that this will continue.

HCB: What are the success factors in succession planning?

LESCHACO SHIPPED ITS first tanker on overseas trade in 1976. HCB spoke to Holger Warnecke (HW)(above, right), who looks back at more than 50 years’ experience in the industry, to discuss how the business has changed, and to Maximilian Nause (MN)(left), who took over responsibility for Leschaco’s tank container fleet in 2022 and gives some insights about the path of future growth.

HCB: What have been the major milestones in Leschaco’s tank container history?

HW: With the shipment of ten tank containers from BASF’s Ludwigshafen plant to New Orleans in November 1976, Leschaco was one of the pioneers in the development of the international transport of tank containers.

After years as a niche operator, in 2005 our owner and I set ourselves the goal of growing the business. Two figures illustrate the success of that ambition: in 2005 we had a fleet of less than 600 tank containers but by 2018 it was more than 5,000 for the first time – now there are around 5,600.

We expanded geographically too. After the countries in Central Europe, the US and Japan from the early days, we are now active with tank containers in all countries in Asia, including India, as well as the Middle East, South Africa, Mexico and Brazil, to name just the major countries.

Finally, I would like to mention that, in the tank container business unit, we are also increasingly concentrating on the transport and fleet management of customer-owned tank containers, a field that fits perfectly with Leschaco’s worldwide freight forwarding and customs clearance activities.

HCB: Are there any specific decisions that you now regret?

HW: Not really, but I regret that our

HW: I thought about succession planning for key functions in my area of responsibility at an early stage - including my own succession. I consider it ideal and successful when young colleagues, who inevitably lack experience, are accompanied for a year and the outgoing manager is available to provide advice as needed. The personal connections that have grown over the years are worth their weight in gold, and passing on these connections to a successor cannot be done by passing on a cell phone number or e-mail address.

HCB: What about you, Maximilian, what have been the successes for you in the transition?

MN: The transition period was both challenging and exciting. One major key success driver is to take time to listen to your team about their expectations and concerns and learn from their experience. Communicate clearly with the team about common goals, and vision for the future. Holger was a great mentor during the transition period, who helped me to navigate any challenges and granted access to his well-established network. He was always transparent and never withheld information that would let me understand business processes quickly.

In addition, it’s important to take ownership of the new role and responsibilities. This means being accountable for actions and decisions, as well as taking responsibility for the outcomes of my team. Don’t be afraid to take decisions, always strive to learn and improve. Lead by example and demonstrate the behaviours and values you want to see from your team. Finally, stay positive during the transition period. Even if there are challenges or setbacks, maintain a positive attitude.

HCB: What have been the biggest changes in the tank container market in the past 40 years?

HW: As everywhere in freight forwarding, IT solutions have made administrative processes more efficient for tank container transports. But the greatest changes have been seen in the tank container itself. The first 20 years were characterised by engineering work to adapt the tank container to all user requirements. Major challenges were encountered with the first polyurethane insulation that released fluorocarbon, which led to stress corrosion, to name just one example of many.

While in the first 25 years the manufacture of tank containers was mainly in Europe, the standard tank container has been built almost exclusively in China for the past 15 years and prices have fallen by more than half during that time.

What remains unchanged, however, is that the goods in the tank container are to be transported from the producer to the consignee using various modes of transport.

HCB: Looking to the future, what topics are at the top of your agenda?

MN: Our people. People are priority at Leschaco and we invest heavily in a professional and personal growth mindset to become an exceptional place to work. We deploy training exchange programmes and online, on-demand e-learnings, regular professional webinars taking place and trainers have just started to travel around the Leschaco offices to spread tank container knowledge across our teams.

We develop green product solutions to strengthen our position on the decarbonisation of supply chains. Driven by corporate green logistic targets, we recognise a conversion from, for example, flexibags and drums to tank containers. This will add to our growth potential in the years to come.

Leschaco supports the defined UN sustainability goals and recently achieved Ecovadis silver status again.

Most notably for sensitive products, real-time tracking and transparency along the customer’s supply chain is demanded so telematics, standardised data exchange and the integration of the vendor environment are Leschaco’s key drivers to provide end-to-end visibility in the future.

We are investing in fleet management systems and deploy a digital customer platform to increase transparency of information. New technologies such as Artificial Intelligence and machine learning algorithms are applied to improve the overall efficiency and reduce operational costs of the business. Tank container operators must have a clear strategic direction for their digital transformation to generate competitive advantages in the future.

We are growing our fleet size significantly and increasing fleet diversity, aiming to be one of the leading deep sea tank container operators in the market as part of our strategy roadmap 2030.

HCB: How does Leschaco differentiate itself from others?

MN: We strive to become a leader for customised supply chain solutions by offering integrated logistics services and a full stack product portfolio. We combine tank container operations with complex inland haulages including heating, customs clearance and related freight forwarding services. Aside from being a tank container operator, Leschaco is active in the fields of sea and air freight and contract logistics, where we operate warehouses, including storage capabilities for hazardous products in key markets. In cooperation with our corporate venture Logward we offer 4PL control tower and supply chain management solutions.

We continue to enhance our global presence in key and new markets by leveraging our expertise in chemicals and dangerous goods, and for other demanding industries. Today we operate our own Leschaco offices in almost every important market in the world by using a uniform IT framework worldwide which leads to high data quality standards.

HCB: Clearly Leschaco still believes in the tank container. What is the growth direction compared to other business models?

MN: The owner family believes in the tank container business model and continues to support an expansion in the coming years. The market is expected to continue growing steadily until 2030, driven by a combination of factors such as technological advancements and integrations, stricter environmental and safety regulations, and intra-regional market developments. To remain competitive and successful in a volatile market, Leschaco follows a strategy roadmap 2030, which focuses on innovation, fleet optimisation, and the ability to adapt to changing regulations and regional dynamics. The company strives for significant growth in the tank container segment in the years to come.

HCB: How do you assess the risk that shipping lines may invest in tank container operations?

HW: In the early years of the deepsea tank container business, some regional shipping lines, but also Hapag-Lloyd, acquired their own fleets; however, they all eventually stopped their activities in this field. Tank container transports require an infrastructure that cannot be equated with box container transports, and the expense is too great for shipping lines from my point of view. It would be conceivable that a shipping line with its currently outstanding profits would come up with the idea of buying a tank container operator, but whether the customers would honour this, I have my doubts as this operator would concentrate its shipments to one shipping line. MN: The shipping lines would need to conduct a thorough feasibility study to assess the risk of investing in tank container operations. The limited market potential and economies of scale, fragmented infrastructure, the need for highly knowledgeable operators, and related systems create a high market barrier. Of course, high profits in the last two years as well as the new integrator approach can lead to some speculations. www.leschaco.com

HCB: Will there be consolidation among tank container operators?

HW: I don’t see any wave of consolidation in the near future. Many operators are in private hands and takeovers are generally more difficult. Look at Leschaco – our tank container activities represent one of five core business areas and can hardly be sold in isolation.

MN: Most of the global leading tank container operators are privately owned. They are driving their own strategic direction and focusing on sustainable, organic growth so we therefore do not foresee major M&A activities. Although the global tank container fleet has grown by around 10 per cent per year in the last 10 years, we see the number of tank container operators has more than doubled. This can likely lead to a consolidation among less competitive, niche operators which have missed the market development recently.