Tuesday, July 15, 2014

Maersk, MSC Sign Vessel Sharing Pact

By Mark Edward Nero

Two of the three companies involved in the failed P3 Alliance of shippers are having another go at it. Maersk Line and Mediterranean Shipping Co. (MSC) announced July 10 that they’ve signed a 10-year Vessel Sharing Agreement (VSA) on Asia-Europe, Transatlantic and Transpacific trades.

The VSA, which the companies have dubbed 2M, replaces all their existing VSAs and slot purchase agreements. The 2M sharing agreement differs from the previously proposed P3 Alliance in two major ways: first, the combined market share is much smaller. Also, the cooperation is purely a vessel sharing agreement; there is no jointly-owned independent entity with executional powers.

Maersk and MSC say the agreement includes 185 vessels with an estimated capacity of 2.1 million TEU. Maersk Line is to contribute 110 vessels with a nominal capacity of about 1.2 million TEUs, or 55 percent of total capacity. MSC contributes 75 vessels with a nominal capacity of almost a million TEUs, or 45 percent of total capacity.

The shipping lines say that with the agreement in place, they’ll be able to provide their customers with more stable and frequent services and cover more ports with direct services as well as improve the efficiency of the companies’ networks through better utilization of vessel capacity and economies of scale.

“The 2M Vessel Sharing Agreement will enable us to achieve significant reductions in fuel consumption, driving down the carbon footprint of our shipping operations,” MSC Vice President Diego Aponte said. “This vessel sharing agreement will mean major cuts in emissions while simultaneously enhancing our service to customers.”

“I am very pleased with our agreement,” Maersk Line CEO Søren Skou said. “We share the same ambition to have as efficient and effective operations as possible.”

The new alliance is a reaction to the rejection last month of plans by Maersk, MSC and CMA CGM to form a coalition. The P3 Alliance was announced in June 2013 as a long-term operational vessel sharing agreement on routes covering Asia to Europe as well as transpacific and transatlantic routes to the United States.

But although it received approvals from US and European officials earlier this year, the Chinese Ministry announced its disapproval June 17 after an anti-monopoly investigation.