Shares of Moller-Maersk dropped by more than 8% when the market opened on Friday due to the conclusion of a U.S. port strike. The strike, which affected major ports on the East Coast and Gulf Coast, was resolved after a tentative deal was brokered on wages between a major U.S. dockworkers’ union and the United States Maritime Alliance. The existing contract was extended through Jan. 15 to allow for negotiations on a new agreement.
If the strike had continued, it could have potentially benefited European shipping companies by allowing them to capture a larger share of the global supply chain market. However, with the resolution of the strike, Maersk shares were down by 7.05% by 9:05 a.m. London time. Other European shipping companies like Germany’s Hapag Lloyd and Swiss logistics company Kuehne + Nagel also experienced declines in their stock prices.
The strike had significant impacts on U.S. supply chains, causing disruptions in the transportation of goods such as fruits, pharmaceuticals, and automobiles. Even during the brief walkout, billions of dollars worth of goods were left stranded offshore, affecting the supply of essential items during the busy holiday shopping season.
This strike was the first of its kind in almost 50 years by the International Longshoremen’s Association, involving approximately 50,000 members out of the union’s total 85,000. The 14 affected ports experienced operational challenges as a result of the strike, highlighting the importance of labor negotiations in maintaining smooth operations within the shipping industry.