Big Shake Up for Container Alliances as CMA CGM Announces New Deal with COSCO, Evergreen, and OOCL

CMA CGM, COSCO Container Lines, Evergreen Line, and OOCL have signed a new ship sharing agreement known as "Ocean Alliance," which is set to begin in April 2017, lasting for a period of 5 years.

CMA CGM S.A. (CMA CGM) Wednesday announced that it has signed a Memorandum of Understanding (MoU) with COSCO Container Lines (COSCO), Evergreen Line (Evergreen) and Orient Overseas Container Line (OOCL) to form a new shipping alliance, known as "Ocean Alliance."

"This new partnership will allow each of its members to bring significantly improved services to its respective customers," the companies said in a joint statement.

Subject to regulatory approval, the new Alliance is set to operate for a period of five years, beginning in April of 2017.

"The Ocean Alliance is a very ambitious operational agreement. CMA CGM, and its new partners, will offer more than 40 maritime loops, providing its customers with an enhanced network of services and fast transit times," said Rodolphe Saadé, Vice-Chairman of the CMA CGM Group.

CMA CGM is currently part of the Ocean Three alliance, along with China Shipping Group and United Arab Shipping Co. (UASC), but with China Shipping having merged with Cosco, it leaves UASC seeking new partners.

OOCL is currently part of the G6 alliance, and with CMA CGM having offered to take APL out of G6 as part of its efforts to push through EU approval for its acquisition of Neptune Orient Lines (NOL), it leaves remaining members Hapag-Lloyd, Hyundai Merchant Marine, Mitsui O.S.K. Lines (MOL), and Nippon Yusen Kabushiki Kaisha (NYK Line) to fill in the gaps there.

COSCO and Evergreen are currently part of the CKYHE alliance, so Kawasaki Kisen Kaisha, Ltd. ("K" Line), Yang Ming Marine Transport Corporation (Yang Ming), and Hanjin Shipping will be the remaining members there.

Left unaltered would be the 2M Alliance between the world's top two container carriers, Maersk Line and Mediterranean Shipping Co. (MSC).

Using consolidated figures from Alphaliner, Ocean Alliance would control 23.5 percent of the world's container capacity, against 2M's 27.7 percent share - a combined total 51.2 percent of the world's container fleet.

Today's announcement will not be a surprise to many, with Alphaliner having revealed talks on the new alliance were underway earlier this year.