Maersk Line, MSC in New Alliance Bid

CMA CGM is not a part of the new alliance

Following the Chinese shutdown of the planned P3 alliance, two of the three alliance members, Maersk Line and Mediterranean Shipping Co. (MSC), plan to make a new bid for a capacity-sharing deal, Reuters reports.

The smaller alliance 2M alliance would share 185 vessels, compared with the 250 ships that would have been part of P3.

The ships, totalling 2.1 million twenty-foot equivalent units (TEU), trade on trans-Atlantic, trans-Pacific, and Asia-Europe routes.

The combined capacity share in the new deal would be less than 30 percent on Asia-Europe routes, compared with more than 40 percent for the P3 alliance, according to Maersk Line CEO Soren Skou.

"This one is only a vessel sharing agreement," Skou said.

"The P3 plan included an operating company which was the main reason why Chinese regulators looked at it as a merger."

Skou said the Chinese Ministry of Transport will consider the new deal, while the Commerce Ministry had investigated P3.

Lars Jensen, an analyst with SeaIntel, said the new alliance should be less worrying to China because the inclusion of CMA CGM in P3 would have meant the destruction of a separate vessel-sharing agreement that company has with United Arab Shipping Co. (UASC) and China Shipping Container Lines.

"By not having CMA CGM in this new vessel sharing agreement, the existing agreement between CMA CGM, United Arab Shipping Company and China Shipping Container Lines can continue. As a consequence, pressure on Chinese container shipping companies is not as big as if P3 was approved," he said.

The Ministry of Commerce has said the combined market share of the P3 alliance would have presented a threat to competition.