CONCERNS RISES OVER 2M ALLIANCE OF MAERSK AND MSC

By Seatrade Global

The Chinese government and the influential China Shipowners’ Association (CSA) have expressed concerns over the recently proposed 2M container shipping alliance between Maersk Line and Mediterranean Shipping Co (MSC).

Shang Ming, chief of the anti- monopoly bureau at China’s ministry of commerce, said in an interview to the local media that the formation of the 2M alliance may result in lower bargaining power for China’s import and export enterprises.

The potential freight shipping price monopoly by 2M would hence lead to higher costs of consumer goods, Shang believed.

Zhang Shouguo, executive vice chairman of CSA, anticipated that the 2M alliance would further raise the competitiveness of Maersk Line and MSC, posing greater challenges for Chinese shipping lines.

Zhang pointed out that while seven of the world’s top 10 businest container ports are in China, Chinese shipping carriers only accounted for less than one-third of the market share.

The proposed 2M alliance is a 10-year vessel sharing agreement between Maersk Line and MSC on the Asia-Europe, transatlantic and transpacific container trade lanes. The alliance will encompass 185 vessels with a capacity of 2.1m teu deployed on 21 strings.

The announcement of the 2M alliance on 10 July comes less than four week after the grander P3 alliance between Maersk Line, MSC and CMA CGM was rejected by China. 

Both Zhang and Shang did not specifically object to the 2M alliance, but they highlighted that the global market share of Maersk Line and MSC is 14.5% and 13.4% respectively, giving them a total share of 27.9%. In Asia alone, the combined market share of Maersk Line and MSC could be up to 35.8%.

Given that the P3 fell at the hurdle of the Chinese approval, all eyes will be on the Chinese authority’s reactions to 2M.

China’s ministry of commerce had rejected the P3 alliance due to its combined 47% market share on the Asia-Europe trade, potentially bringing about “adverse effects on restricting competition”.

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