Big ships could come to US ports under Maersk, MSC alliance WASHINGTON — Maersk Line and Mediterranean Shipping Co. could eventually operate ships of up to 19,200-TEUs on east-west trades that touch the U.S., within their planned “2M” vessel-sharing agreement, according to a filing with the U.S. Federal Maritime Commission. The two largest global container lines said they will initially operate a total of 97 vessels on the trans-Pacific and trans-Atlantic with capacities between 4,000 and 13,000 TEUs. They said they could eventually operate up to 130 vessels with capacities of up to 19,200 TEUs each, which would be much larger than the largest ships that call at the U.S. currently, which are roughly 14,000 TEUs. According to the filing, the 2M would have a duration of 10 years, and the carriers would have to give each other at least two years’ notice before walking away from the VSA — unless one of the partners is sold or in “material breach” of the contract terms. Like the amended and now-defunct P3 Network, Maersk and MSC would separately handle contract negotiations with third parties, such as stevedores, marine terminal operators and inland carriers, according to the filing. The FMC required the duo, along with CMA CGM, to make such changes to the P3 before voting 4-1 in March to allow that proposed alliance to go forward. The trio scuppered the plan in June after China rejected it, with Chinese regulators saying it would reduce competition and hurt “social public interest.” China also rejected the P3 in part because of a centralized operations center planned to be based in London, a move that to Beijing authorities looked like a virtual container line, not a strictly operational alliance, according to some China analysts. This time around, Maersk Line and MSC would create a joint coordination committee consisting of employees from both carriers. From a site independent from their respective Copenhagen and Geneva headquarters, the committee staff would focus on “day-to-day issues arising from the agreement, and shall monitor the operation of the agreement to ensure the maximum efficiencies are obtained from the parties’ cooperation,” according to the filing with the FMC. Although the committee can make suggestions to Maersk and MSC, it can’t make operational decisions. The 2M, which would launch early next year if approved, would encompass a total of 185 vessels globally with an estimated capacity of 2.1 million TEUs on 21 strings, all in the east-west trades. Maersk would supply 55 percent of the capacity, with MSC supplying the rest. The VSA would allow the two carriers to consolidate their services around fewer but larger ships, resulting in lower per-container operating costs and giving them a cost advantage over carriers and alliances that operate smaller vessels. The FMC has until Oct. 11 to decide whether to allow the 2M to go forward or seek a federal injunction to block it. The agency can stop the clock at any point during the 45-day review to ask questions, and a new 45-day review would start once the carriers answer the agency’s questions. There is no time limit for how long Maersk and MSC could take to answer the FMC’s questions, but presumably they would want to do it quickly to expedite the review. History suggests the FMC will allow the VSA to go forward. The agency hasn’t sought an injunction against any proposed VSA since it gained the power to do so as part of the Shipping Act of 1984. With the act as their guide, commissioners will gauge whether the VSA would bring an “unreasonable increase in transportation costs,” an “unreasonable decrease in services,” or both. JOC NEWS - AUG 28 2014
Posted on: Thu, 28 Aug 2014 23:49:46 +0000
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