Houthi attacks on ships escalate: Experts look to COVID supply chain lessons

Lisa Anderson, a supply chain expert and president of California-based LMA Consulting Group, says that in the past, shippers, vessel operators and manufacturers may have waited too long to properly evaluate an emerging threat such as COVID-19 or the Houthis, when taking action sooner would have been prudent.

###

As Houthi attacks on ships escalate, experts look to COVID supply chain lessons

An upsurge in attacks on commercial ships by Iranian-backed Houthi rebels in the Red Sea threatens to disrupt the global supply chain as vessels are forced to reroute around Africa to avoid the conflict zone. Normally, about 15% of the world’s trade passes through the Red Sea, and delays and escalating insurance costs are hitting industries such as petroleum, food and electronics.

Manufacturers have already experienced some problems in getting parts to assembly floors, and both Tesla and Volvo last week blamed the Red Sea troubles for delays at plants in Europe.

But shipping industry experts hope lessons learned during the COVID-19 pandemic, the Suez Canal disruption in 2021 and Somali pirate attacks more than a decade ago will help mitigate widespread problems this time, should the conflict widen in the Red Sea.

Since October, the Houthis have targeted several ships on the Red Sea with ballistic missiles and drones and have hijacked others near the entrance to the vital corridor at the Bab-el-Mandeb strait. The Houthis have said their attacks are in response to Israel’s air and ground assault on Gaza, which has killed nearly 25,000 Palestinians, according to Gaza’s Health Ministry. The military campaign in Gaza followed the Oct. 7 attack by Hamas that Israel says killed 1,200 people.

The U.S., leading a maritime coalition involving more than 20 countries, according to the Defense Department, has launched airstrikes against the Houthis to secure the waterway.

Supply chain disruptions are nothing new for the shipping industry. The COVID-19 pandemic presented an unprecedented challenge for the industry — with vessels stuck at ports waiting to load goods even as freight rates skyrocketed from a lack of capacity and quarantined consumers ordered everything online. Also in the Red Sea, the giant Ever Given container vessel became lodged in the Suez Canal in 2021, halting all traffic through that vital area for nearly a week. And more than a decade ago, Somali piracy was a major concern for shippers as well.

 

Read more at NPR here.