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New ocean carrier alliance may alter Asia-North Europe balance

Shippers using several other key markets, including Asia-Europe, Asia-Southern Africa and the South American markets, may also feel the impact
By Patrick Burnson, Executive Editor
December 06, 2011

Traditional rivals, MSC and CMA CGM, are changing course now to work together as operating partners in several key trade lanes.

According the Paris-based consultancy, Alphaliner, The impact of the new partnership will be felt most intensely on the Asia-North Europe trade, where the two carriers are to co-operate on four loops. These jointly-run services will be based on existing offerings, namely on MSC’s “Silk” and “Lion” services and on CMA CGM’s “FAL 1” and “FAL 3.”

But shippers using several other key markets, including Asia-Europe, Asia-Southern Africa and the South American markets, may also feel the impact

“These four loops are to be revised, in particular to accommodate the respective hubs of each of the two carriers,” said Alphaliner’s commercial director, Stephen Fletcher. “The deal is expected to help fill MSC’s armada of giant containerships.”

The shipping line is expected to operate 57 ships of 12,500-16,000 twenty-foot equivalent units (TEUs) by the end of 2015 (of which 24 remain to be delivered), according to Alphaliner records, while CMA CGM is expected to have only ten ships in this size range by that date (of which three remain to be built), in the absence of any new orders or fresh charters.

“Without speculating on future deals, MSC could potentially hire some of its big units to CMA CGM as part of the cooperation,” said Alphaliner analysts. “This would help the Swiss-Italian carrier to keep its fleet employed while allowing CMA CGM to achieve its growth plans which have been derailed by the financial crisis.”

Analysts added that the new MSC-CMA CGM partnership should become the leader in the Far East-North Europe trade, where the combined fleet of the two carriers currently gives them a 22 percent capacity share.

About the Author

Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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