The new shipping alliances landscape

The new shipping alliances launched on the 1st April 2017, heralding significant changes and prompting many questions: With no competition on the main Asia Europe routes, will the lines push prices up; or with more sailings and new vessels joining, will congestion end and prices come down?

The total weekly capacity of the new alliances from Asia to North Europe will increase by almost 10%, as THE Alliance and the 2M Alliance will provide one more string than currently offered and are preparing for the phase-in of additional vessel capacity, which would normally put downward pressure on rates, but with no competition from independent carriers that’s not certain.
New shipping alliances

No void sailings are scheduled on any of the new strings to be launched in April and some of the old services that are being phased out, will provide overlapping sailings that will effectively create additional capacity during the transitional period, so backlogs should clear quickly.

The 2M carriers plus HMM’s average capacity on the Asia-North Europe route will increase by around 20,000 TEUs per week, or 23%, from 83,500 TEUs to 103,000 TEUs.

Ocean will offer six weekly strings and THE Alliance will offer five, with a combined weekly capacity of 155,000 TEUs. They will provide the same total number of weekly sailings as that offered currently by the G6 (four strings), CKYE (four strings), and O3 (three strings), and total weekly capacity will increase by about 13,000 TEUs, or 9%.

Shippers will have a total of 372 direct port pair options in the westbound leg to North Europe, but 113 of these pairs will be unique to one alliance, so you would expect the pricing pressure in 1/3 of all port pairs to be greatly reduced.New shipping alliances

Of the direct routes that the OCEAN and THE alliance now offer, 60% on the Asia-Europe trade routes will have a faster transit time – with over half speeding up by three or more days.

The three alliances are dropping 380 and adding 300 direct routes, many with new port pairings, on the main Asia-Europe, trans-Atlantic, and trans-Pacific trades.

Services are potentially available through any of the carriers in the alliance, which means that as they add new ports, their direct port pairs and transshipment options will grow as well, improving speed and reliability.

The new shipping alliances

2M
190+ vessels
6m TEUs
29.5% global capacity
– Maersk
– MSC

THE Alliance
240+ vessels
1.9m TEUs
16% global capacity
– K Line
– MOL
– NYK
– Yang Ming

Ocean Alliance
323 vessels
5.5m TEUs
26% global market share
– CMA CGM
– COSCO
– Evergreen
– OOCL