Freight forwarding giants are pigeoned? USD 2.5 million is claimed

As Hubbell, a well-known US manufacturer of power products, terminated both contracts shortly after they were signed, DSV demanded that Hubbell pay at least US$2.5 million in damages.

In a lawsuit filed in the US court, the Danish freight forwarding giant's lawyers said: "Hubbell's refusal to perform the contract of carriage agreement has caused DSV substantial losses. ”

In April 2022, DSV signed two contracts with Hubbell for container shipping from China to the United States. Under the agreement, DSV ensures that Hubbell transports its cargo at a fixed price, while the latter undertakes to deliver a certain number of containers per week for three years.

However, just a month later, Hubbell wanted to terminate the contract because it believed that the agreed freight rate was too high. At that time, container freight rates soared to new highs during the epidemic and then plummeted. DSV declined to comment on the case, which is currently pending in a court in Delaware, USA. Hubbell, a U.S.-listed company that sells cables, tools and other electrical equipment, also declined to comment on the case.

DSV COO Jens Lund confirmed to the media that record high freight rates and insufficient capacity were "the main factors in our disagreement in interpreting the contract".

Now it seems that the sharp fluctuations in freight rates in recent years seem to have once again tested the relationship between freight forwarding logistics companies and customers.