Danish shipping group, A P Moller-Maersk Group A/S, which runs Maersk Line, the world’s biggest container carrier, will cull the Safmarine and Damo brands by the year-end, by folding them into the Maersk brand in a major reorganisation announced on Tuesday that entails job cuts worldwide, including in India.

“Simplifying the organisation will regrettably impact jobs due to the discontinuation of duplicate roles and roles that will no longer be needed. We are committed to working with our employee representative bodies across the impacted locations throughout the process and aim to finalise the process for most locations by October 1,” A P Moller-Maersk said in a statement.

“This is no reflection on our people, who have all worked relentlessly and have been fully committed to serving our customers. It is not easy to say goodbye to skilled and dedicated employees, but, regrettably, it is a consequence of the integration and a necessary part of our efforts to reduce costs in order to drive sustainable growth as we pursue our strategic objectives,” it said.

Moller-Maersk did not disclose how many jobs will be impacted in India as a result of the overhaul.

“We are not in a position to disclose any specific numbers while we work with our employee representative bodies across the impacted locations and will first and foremost ensure that our employees are informed first,” the company told BusinessLine in an e-mail.

Integration of Safmarine, Damco brands

As part of the strategic changes unveiled to improve customer experience and end-to-end service delivery, the Safmarine brand will be integrated into Maersk to enhance customers’ access to the global integrated offering.

Besides, the Damco brand’s Air and LCL (Less than Container Load) offering will be combined with Maersk’s logistics and services products to complement its end-to-end offering. Also, a more simplified and customer-centric global ocean and logistics organisation is being introduced.

These changes represent a major step towards becoming an integrated container transport and logistics company, connecting and simplifying customers’ supply chains.

“Our customers are at the heart of our vision. Their evolving supply chain needs are increasing the demand for multiple modes of transport and to meet these needs, we’re bringing our company’s expertise and capabilities even closer together. Taking these steps are key to accelerating our transformation,” said Vincent Clerc, CEO of Ocean & Logistics, A.P. Moller - Maersk.

Over time, the value propositions of Maersk and Safmarine (which Maersk acquired in 1999) have converged, as both brands have been focusing on building a customer-centric culture and as the digital interactions with customers have increased.

“With the integration of Safmarine, we can present Safmarine customers with the full ocean and supply chain offering and more scale,” Clerc said.

Since focusing purely on freight forwarding in 2018, Damco has demonstrated significant value to customers in the Air and Ocean LCL space. During this time, it has become apparent through close customer engagements that the value proposition of Maersk can be greatly enhanced with the expansion of multiple modes of transport.

Maersk uses its own assets to offer unique value propositions. Hence, it will not pursue the ocean FCL (full container load) multi-carrier product (NVOCC) as a general offering.

“Businesses need Air and LCL products to connect their supply chains and with these offerings firmly placed in our global integrated portfolio, we aim to serve our businesses better and more efficiently across their supply chains,” Clerc said.

Due to the changes, the Safmarine and Damco brands will no longer be marketed by the end of 2020.

As part of the transformation, the back offices of Maersk and Hamburg Süd will come closer together into more customer-centric teams, while continuing to meet customers as two separate brands with a differentiated service model.

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