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UAE, UAE, ABU DHABI - Transport

Farook Al Zeer

Chairman, Logistics Cluster, AD Ports Group

Bio

Farook Al Zeer, Chairman – Logistics Cluster, AD Ports Group. Farook Al Zeer is the Chairman of the Logistics Cluster at AD Ports Group. In this position, he oversees the development and implementation of the Cluster’s growth strategy and is responsible for working with clients and partners to meet their business requirements and create value-driven relationships. He has more than 40 years of experience in the shipping and logistics sector in the MENA region, during which he held senior positions at leading supply chain management companies, including DB Schenker and Kuehne + Nagel.

"2022 was a year of substantial expansion for the Logistics Cluster."
AD Ports Group’s Logistics Cluster aims to become a top-10 global logistics provider, and is developing a sustainable growth portfolio to capitalize on opportunities that the global economy presents.
What were your main achievements of 2022?

2022 was a year of substantial expansion for the Logistics Cluster. We have taken concrete steps toward achieving our mission of becoming a top-10 global logistics provider of choice that delivers fully integrated and technologically innovative end-to-end logistics solutions that drive competitive value for our customers. To achieve our mission, we are building a leading presence in all major global markets through a mix of strategies that include organic growth, acquisitions, joint ventures, and partnerships. So far, I am happy to report that we have already made significant progress in this direction, especially when it comes to growing our international presence and capabilities. Perhaps the most significant initiative of 2022 has been the group’s AED2.5 billion acquisition of Noatum, a world-class logistics player that has a strong presence across all major global markets including those in Europe, Asia, North and South America, and Africa. The significance of the acquisition is that it allows for our immediate expansion across 26 countries, including 16 terminals and 132 ports, thereby providing us with high growth potential and capacity to scale. In addition, given that Noatum operates an asset-light model with a high cash conversion rate, we expect to see the acquisition make an immediate contribution to our financials, once the necessary regulatory approvals are secured.

How does the cluster plan to optimize its logistics operations to reduce environmental impact and promote sustainability?

In terms of warehousing operations, at KLP21, which is one of the region’s largest food logistics centers, our cluster operates a new state-of-the-art warehouse where we have implemented a range of advanced insulation solutions to reflect sunlight and thereby reduce our energy usage. At the facility, we are also leveraging solar power to maximize energy efficiency and reduce emissions, recycling water for irrigation, and employing a centralized refrigeration system for greater efficiency. Furthermore, our team is also taking several significant steps to reduce our carbon emissions and improve efficiency of our transport fleet. Specifically, we are retiring older vehicles and replacing them with newer more efficient models with better fuel consumption, lower emissions, and reduced maintenance costs. As a matter of fact, MICCO recently announced the acquisition of 63 advanced new vehicles and is taking out of service an equivalent number of older and less efficient models. Looking into the future, we are also exploring the potential of converting some of our fleet’s existing cargo vehicles from diesel to electric power as part of our fleet operations and bringing in EV units as the technology matures and regulatory environment develops. To this effect, MICCO will be testing an electric truck from a major manufacturer in the near term to evaluate its performance and future application within our fleet. From a fuels perspective, the cluster has tested the use of advanced additives on a trial basis, which has shown to improve fuel efficiency by up to 30% and has introduced telematics for fleet management, which drives the fleet’s effectiveness by monitoring fuel consumption and drivers’ habits, while optimizing delivery routes.

How do you see the logistics industry changing in the post COVID-19 environment?

Looking back over the past three years, what the outbreak of COVID-19 exposed was that global supply chains, as structured under the “just-in-time” model and highly dependent on manufacturing capacity within a relatively small number of jurisdictions, were vulnerable and susceptible to major disruption. The corresponding supply chain disruption created a demand/supply imbalance, causing upward movement in freight rates, which in turn was reflected in inflationary pressures on consumer prices. The logistics industry is still in the process of restructuring global supply chains, which explains why freight rates have remained volatile and why the global shipping industry can provide price quotes with validity of one week at a time. Therefore, I believe that the future of logistics is in the integration of services and diversification of sourcing. AD Ports Group is extremely well-positioned in this environment as our structure allows us to leverage our cross-Cluster portfolio of services within a single integrated, scalable and compelling value offer.

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