The airfreight division of Ceva Logistics achieved year-over-year volume growth of 5 percent in the third quarter. However, revenues in its freight management division dipped by 1 percent to US$935 million during the period ending Sept. 30.
The third-party logistics firm said “revenues were impacted by the continuation of challenging market conditions and softness in export out of Asia Pacific and Europe.” Ceva also noted that tightening airfreight capacity in the trans-Pacific lanes had negatively affected margins, partially offsetting the volume increase.
Contract logistics fell by 1.8 percent in Q3, the company said. Although the division realized a strong performance in the U.S. market, these gains were offset by “soft volumes in the Asia Pacific automotive market and certain new contract short-term challenges during implementation,” according to a company statement.
Ceva’s oceanfreight division also reported significant growth, outperforming the market with an 11 percent volume increase for Q3.
In January 2015, Ceva said it will begin rolling out a new operating model that replaces the existing region-based structure with one based on 17 “geographic clusters” of countries, each of which share standardized governance and business rules. In some cases, a cluster may consist of a single country, such as China.
The new model, said Ceva CEO Xavier Urbain, is expected to “increase the velocity of our business by adopting a local, rather than region-based, operating model. For our customers, local ownership of execution is very good news, enabling faster decision-making and greater responsiveness to their needs.”