Factbox-How companies are responding to attacks on ships in the Red Sea

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Factbox-How companies are responding to attacks on ships in the Red Sea
Credit: © Reuters.

(Reuters) -Attacks on vessels by Iranian-backed Houthi militants in Yemen have disrupted international commerce on the shortest shipping route between Europe and Asia.

The attacks, targeting a route that accounts for about 15% of the world's shipping traffic, have pushed several shipping companies to reroute their vessels.

The U.S. and Britain launched air strikes against Houthi military targets overnight on Jan. 11 and 12, widening regional conflict stemming from Israel's war in Gaza.

Below are some companies' responses to the disturbances (in alphabetical order):

BP (LON: BP )

The oil major on Dec. 18 said it had temporarily paused all transits through the Red Sea.

DANONE

The French food group said in December that most of its shipments had been diverted, increasing transit times. Should the situation last beyond 2-3 months, Danone will activate mitigation plans, including using alternate routes via sea or road wherever possible, its spokesperson said.

DHL

The German logistic company's CEO said on Jan. 17 that the diversion of freight could lead to a shortage of shipping containers in Asia in the coming weeks.

DHL, which does not operate ships but uses them to transport containers, had on Jan. 8 advised customers to take a close look at how they manage inventories.

ELECTROLUX

The Swedish home appliance maker has set up a task force to find alternative routes or identify priority deliveries to try to avoid disruptions. It sees a limited impact on deliveries for now.

EQUINOR

The Norwegian oil and gas firm on Dec. 18 said it had rerouted vessels that had been heading towards the Red Sea.

ESSITY

The maker of brands such as Libresse and TENA said it was staying in contact with impacted suppliers to ensure continued flow of goods, but added the impact on its business was limited.

FEDEX

The U.S. parcel delivery giant said on Jan. 14 it hasn't seen much of a shift to air freight due to disruptions in the Red Sea.

GEELY

Geely, China's second-largest automaker by sales, said on Dec. 22 its EV sales would likely be impacted by a delay in deliveries, as most shipping firms it uses to export EVs to Europe reroute ships around Africa.

IKEA

The Swedish ready-to-assemble furniture retailer on Dec. 19 said the situation would result in delays and may cause availability constraints for certain products. "We are evaluating other supply options to secure the availability of our products," it said.

KONE

The Finnish elevator maker said the situation may in some cases delay shipments, but most of its customer deliveries should stay on schedule. Kone said it had prepared for the disruptions by seeking alternative delivery methods and routes.

LIDL

Lidl unit Tailwind Shipping Lines, which transports non-food goods for the discount supermarket chain and goods for third-party customers, said it was sailing around Africa for now.

MICHELIN

Four factories in Spain owned by the French tyre maker are planning to halt output on Jan. 20-21 due to delays in the delivery of raw materials, the company's Spanish subsidiary said on Jan. 16.

NEXT

The British clothing retailer's CEO on Jan. 4 said sales growth would likely be moderated if disruptions continued through 2024. He said Next, which sources the majority of its products from Asia, could mitigate this through earlier ordering or using some air freight.

PEPCO

On Jan. 18, the Poundland owner warned its supply could be impacted in coming months if disruptions continue. There is a limited impact on product availability currently, it said.

"If this goes on for a long time, we will need to have a plan B," Executive Chairman Andy Bond said, adding Pepco can absorb the incremental costs.

QATARENERGY

The world's second largest exporter of liquefied natural gas has stopped sending tankers via the Red Sea although production continues, a senior source with direct knowledge of the matter told Reuters on Jan. 15.

SAINSBURY'S

Britain's second largest grocer said on Jan. 10 it was in regular contact with the UK government about the Red Sea disruptions.

"We're making sure that we plan the sequencing of product from Asia Pacific so that we get products in the right order," CEO Simon Roberts said, adding that long term contracts with shippers "mitigate any cost impact as far as possible".

SHELL

The British oil major suspended all shipments through the Red Sea indefinitely, the Wall Street Journal reported on Jan. 16, citing people familiar with the decision. Shell (LON: RDSa ) declined to comment.

TARGET

The U.S. retailer is experiencing some disruptions of shipments from India and Pakistan, a source familiar with the matter said on Jan. 12, calling the effect "minor" overall.

TESLA

The U.S. EV maker will suspend most car production at its factory near Berlin from Jan. 29 to Feb. 11 due to a lack of components caused by shifts in transport routes.

TRACTOR SUPPLY

Deliveries for the U.S. retailer have been delayed anywhere from two to 20-plus days, the company's chief supply chain operator said on Jan. 12.

© Reuters. FILE PHOTO: A forklift carries a shipping container at the Red Sea port of Hodeidah, Yemen June 24, 2018. REUTERS/Abduljabbar Zeyad/File Photo

VOLVO CAR

The Swedish automaker said on Jan. 12 it would halt production at its plant in Belgium for three days due to delays caused by the situation in the Red Sea.

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