April 1st 2017 saw the introduction of the new carrier alliances which will last for the next decade or so. The previous four shipping alliances have gone to be replaced by just three. The new alliances have been formed due to several key factors. Back in 2008 many of the major liners started investing in bigger container ships. These ships entered the market with lower running costs and thus some core lines were able to offer lower than their competitors on given trades. To stay competitive other carriers then began investing in these larger more economical vessels so resulting in an over capacity on many routes. Other factors that helped decide the creation of the new alliances included the fall of Hanjin Shipping, unprecedentedly low rates throughout 2016 and a high number of mergers throughout the ocean shipping industry. The new carrier alliances represent nearly 80% of the global container capacity and are currently divided as below:
The 2M Alliance – Maersk, HMM, Hamburg SUD & MSC
The Alliance – NYK, MOL, K Line, Yang-Ming & Hapag Lloyd (with UASC)
The Ocean Alliance – CMA-CGM, Evergreen, OOCL, APL & Cosco Shipping.
So, what sort of effect will these new mergers have on the current schedules and availability offered to shippers? Schedules will be more fixed and less likely to change once the new alliances are settled in. Some ports are seeing an increase in the amount of calls they receive, whilst others are seeing a reduction. For example, Singapore prior to the new alliances received 29 calls per week, this will increase to 34 now the new alliances have kicked in. On the other hand, both Hong Kong and Port Kelang will see a reduction in the services it receives from the alliances. Hong Kong from 15 to 10 calls and Port Kelang 11 to 5 calls. As a consequence of the services being shifted there also appears to have been a short-term capacity issue, such as the route back to Asia from Northern Europe. Being able to get space and competitive rates has been proving difficult for many freight forwards and shippers for some time but is now showing signs of easing. In regards to speed of service a high percentage of routes will have a faster transit time. Asia – Europe will be 60% faster whilst transatlantic will have 47% of its lanes faster. All this said there will still be space in the market for the smaller independent liners and specialist carriers. Atlas Logistics UK Ltd is well placed for access to all the global liners both import, export and cross-trade. Just contact us if you have any questions or requirements in this area.