Kuehne & Nagel Inc.

Global trading volumes have been declining since the fourth quarter of 2007. From a global perspective, the volatile environment did not take place overnight. In 2008, trading volumes between Asia and Europe, as well as Europe and North America, slowed much faster than the North America-related trade lanes. During 2009, particularly during the first two quarters, we will see a very volatile market with regard to sea and airfreight rates. However, importers and exporters will not see dramatic rate decreases because sea and air carriers will take capacity out of the market. Because the U.S. economy forces everyone to tighten their belts, we will see a firmer trend toward outsourcing to reduce direct costs. This will offer additional opportunities for 3PL and 4PL providers. A stabilization and normalization of capacity and pricing will not take place before the third, or even the fourth, quarter of 2009. Needless to day, this year will be a genuine challenge. However, resilient companies with experienced management teams will succeed and prevail.