German Retailer Lidl Starts Shipping Line to Buy Containerships

German retailing giant Lidl, part of the Schwarz Group, the fifth-largest retailer in the world, reportedly has a unique solution to the supply chain frustrations that have been plaguing retailers around the world. They plan to start a shipping line and buy containerships to maintain their flow of goods.

The company which operates hypermarkets in Europe and in recent years has begun expanding into the United States filed an application with the European Trademark Office registering the brand name Tailwind Shipping Line. According to the filing, the company intends to use the new operation for the transportation and delivery of goods, including cargo transportation; cargo ship transport; air cargo transport; Import and export cargo handling services.

News that the retailer is in negotiations with shipping companies was first reported in the German trade publication Lebensmittel-Zeitung and later confirmed by the company to a wide range of German media. Lidl, which operates around 11,200 stores and is active in 32 countries, is reportedly seeking greater consistency and flexibility in managing parts of its supply chain. The trade publication reports that Lidl first sought to invest in an existing shipping company before deciding to start its own shipping company and purchase ships.

"We can confirm that Lidl will use some of its own sea freight capacities in the future. This is another building block for securing our supply chains and the availability of goods in our branches," a spokesman for the company told the German publication Manager Magazin.

Reports indicate that the retailer currently has a volume of 400 to 500 TEU per week, presumably for its operations in Germany or across Europe. There was no indication of how many ships they might be planning to buy or what routes they plan to operate.

Lidl is not the first retailer to expand into shipping recently. Starting in 2021, a broad range of companies including Amazon, Ikea, Home Depot, and Dollar Tree as well as suppliers for Walmart, each reported chartering vessels to move containers from Asia. FedEx launched a shipping container service from Asia on chartered bulkers offering shippers the opportunity to move goods to California while the company was also taking delivery of new containers in China that will be used with its onshore freight services in the United States.

Furniture company Loctek which manufacturers its standing desk in Shenzen, however, was the first to order a containership newbuild. In January 2022, the company reported in a stock exchange filing that it contracted with the Huanghai Shipbuilding Co., located in Shandong Province, China to build a container ship at a cost of $32.8 million that will be delivered by March 31, 2023.