UASC Deal to Give Hamburg Süd a Foothold in Ocean Three

The deal will give UASC presence in South America, where Hamburg Süd is strong. 

Germany-based Hamburg Süd and United Arab Shipping Company (UASC) have announced a cooperation agreement that will also give Hamburg a foothold in the Ocean Three alliance, Shippingwatch reports. 

"The agreement has in principle been ready for some time, but it's not until now that we've been able to complete it," said Jørn Hinge, CEO if UASC. 

The Ocean Three alliance involving France's CMA CGM, China Shipping Container Lines, and UASC was established after the breakdown CMA's P3 deal earlier this year. 

Maersk Line and Mediterranean Shipping Company, the other proponents of the failed P3 deal, went on to form their own 2M vessel-sharing agreement (VSA).

The new agreement will see Hamburg Süd participate in UASC's East-West routes starting late this year and early next year.  

"And vice versa, Hamburg Süd will be collaborating not just with us but with Ocean Three as a whole. You'll soon be able to see their container colors on the alliance's ships," says Hinge.

The deal will also help UASC establish a presence in South America, where Hamburg is said to already enjoy a strong position. 

"This is a good agreement for both parties, as it gives us both access to new trade routes without having to invest in new tonnage, because both carriers benefit from having new and efficient tonnage. Hamburg Süd operates the biggest and newest ships on the South American trade, and this will be a major bonus for us, he said. 

Hinge also squashed rumours that the move was a response to rival and fellow German company Hapag-Lloyd's acquisition of Chilean CSAV.

"There's competition on all trade routes, so the South America route is nothing special. The collaboration is not set to begin until next year, and we won't be dominant on South America," he said.

UASC will gain access to Hamburg Süd's South America routes mid-2015.

The Ocean Three alliance was announced earlier this month.