A partnership between two of the biggest names in container shipping was unveiled yesterday, when Mediterranean Shipping Co (MSC) and CMA CGM announced an operating alliance.
The deal between the world’s second and third largest container lines was brokered by MSC VP Diego Aponte, son of MSC founder Gianluigi Aponte, and CMA CGM Executive Officer Rodolphe Saadé, the son of Chairman Jacques Saadé
“It makes a lot of sense to team up with another family-run company,” Saadé told IFW’s sister publication, Lloyd’s List. “The next generation wants to develop more business together.”
He said the two had decided to work more closely together after co-operating in a number of trades in recent years.
“Based on this experience and our shared vision of the shipping industry, we have decided to step up our partnerships, which reflect a commitment to long-term co-operation and will enable us to offer customers improved solutions and services,” he said.
The rapport between the sons of two of the most powerful men in container shipping proved instrumental in forging the new MSC-CMA CGM alliance, which has the potential to reshape the industry and further distance the top three lines from the rest of the competition.
Under the agreement, which starts in March and will be for two years initially, in line with European competition rules, the partnership covers several trades, including Asia-Northern Europe, Asia-Southern Africa and all of the South American markets.
If all goes well, the collaboration could be extended to other routes, but Aponte stressed that this was absolutely not the forerunner of a merger.
Both lines will maintain their independence, collaborating only on service operations. No jobs are at risk as a result of the partnership.
The goal is to deploy the largest ships suitable for each trade lane in order to obtain the maximum efficiencies.
The French line will end an existing vessel sharing agreement with Maersk Line covering its FAL 2 loop in March, said Saadé, although joint operations with the Danish line will continue in other trades.
Both sides insisted that the partnership encompassed vessel sharing or slot swap agreements, with neither joint sales and marketing, nor collective pricing part of the agreement.
“The idea is very simple, to put volumes together in order to gain economies of scale and fill up our larger ships,” said Aponte.
Saadé said the combined market shares of CMA CGM and MSC on the routes where they will be co-operating would be well below the threshold at which Brussels could require antitrust clearance.
Courtesy of IFW
