Global shipping company alliance and shipping market

After the acquisition of OOCL by COSCO and the bankruptcy of Hanjin, THE Alliance, Ocean Alliance, and 2M + H became the three dominant shipping lines in the market. Let's analyze these three powerful shipping lines alliances and how it affects the world shipping industry.

Global shipping company alliance and shipping market

After the acquisition of OOCL by COSCO and the bankruptcy of Hanjin, THE Alliance, Ocean Alliance, and 2M + H became the three dominant shipping lines in the market. Let's analyze these three powerful shipping lines alliances and how it affects the world shipping industry.

Who are the new shipping lines alliances?

Former shipping line alliance (From 2016 and earlier):

2M Alliance: Maersk and MSC

Ocean Three Alliance: CMA CGM, UASC, China Shipping

G6 Alliance: NYK Line, OOCL, APL, MOL, Hapag-Lloyd, HMM

CKYHE Alliance: K Line, COSCO, Hanjin Shipping, Evergreen, Yang Ming

New shipping lines alliance (From April 2017):

2M Alliance: Maersk (owns Hamburg Sud), MSC and HMM (not official members but HMM participates in shipping exchange with Maersk and MSC)

Ocean Alliance: CMA CGM, Evergreen, OOCL and COSCO Shipping (newly merged)
THE Alliance: NYK, MOL, K Line, Yang Ming, Hapag-Lloyd (merged with UASC)

These three shipping lines alliances will account for 77.2% of global container traffic and dominate the international maritime route with 96% of the shipping traffic. Ocean Alliance is the alliance with the highest number of service routes with 40 routes. THE Alliance ranked second with 32 services and followed by 2M with 25 services. In particular, THE Alliance and Ocean Alliance will provide 11 transit routes from Asia to Northern Europe per week, 2M also increase the number of services per week from 5 to 6.

For the Middle East and Red Sea region, Ocean Alliance currently leads with 7 shipping lines, meanwhile, THE Alliance has only 1 service and 2M has not even had any service for this area. As for the Asia - US West Coast, Ocean Alliance is leading with 13 routes, THE Alliance owns 11 routes and 2M has only 5 routes.

Influence on world shipping

With the cooperation between shipping lines, the change of routes and the exchange of containers will certainly have a direct impact on seaports. After the CMA CGM acquisition of APL, the Singapore port will increase the number of ships docked per week from 29 to 34, because CMA CGM will force APL to pass through CMA CGM-PSA Lion Terminal in the lion island of this corporation. .

At the same time, the Port of Kelang (Indonesia), will experience a decline from 11 to 5 ships per week, and the increasing competition of the Hong Kong port.

As for THE Alliance, Singapore will remain the alliance's primary feeder port in Southeast Asia. And Malaysia's Tanjung Pelepas will be the main port of the 2M alliance in the region. On the European side, the Port of Rotterdam remains at the forefront of the region, while rival Hamburg will lose 1 trip per week from the Ocean Alliance.

US Shipping Commissioner William Doyle has called on shipping alliances to increase bankruptcy protection, avoiding global supply chain failures such as Hanjin bankruptcy.

In response to the call, THE Alliance announced it had opened an emergency fund to prevent bankruptcy. This alliance will use the fund to ensure the activities of its members are always carried out.

Meanwhile, Ocean Alliance said that they will not need to set up an emergency fund because the members of the alliance have solid financial resources.

2016 and 2017 marked the period of the most powerful changes in the world shipping market, with a series of mergers and major bankruptcies. These events have formed major shipping alliances and will certainly change the landscape of navigation in the future.