Trends in Ocean Alliances
Shipping alliances, also called ocean alliances, are an important part of the economic ecosystem for freight carriers and consumers alike. Over the years, they’ve evolved from a large collection of smaller carriers to a smaller collection of the world’s largest shipping companies. Today, there are three ocean alliances: THE Alliance, Ocean Alliance and 2M. In this article, we’ll look at trends in shipping alliances.
The history of ocean alliances
Prior to April 2017, the former iterations of ocean alliances included a large collection of smaller carriers which used the alliances to compete in the global shipping marketplace. However, in April 2017, the 8 largest shipping companies decided to form 3 alliances that would expand their foothold in the market and allow them to provide better service, increase their fleet and share resources with one another. Currently, these shipping alliances contain 11 different carriers.
The three alliances formed were dubbed THE Alliance, Ocean Alliance and 2M. These groups include the following carriers:
● 2M: MSC and Maersk
● Ocean Alliance: CMA-CGM, APL, COSCO, Evergreen, and OOCL
● THE Alliance: Hapag Lloyd, ONE, Yang Ming, and Hyundai Merchant Marine (from April 1st, 2020)
The future of ocean alliances
Ocean alliances influence a number of effects on shipping and the economy. For this reason, the decisions of shipping carriers lead to trends that help offset these effects. Some of the effects that shipping alliances cause include overcapacity and concerns over monopoly. In the future, shipping carriers may see countries cracking down on enforcement of antitrust laws or reconsidering block exemption to increase competition in shipping among carriers. Because of these considerations, it’s likely the structure of shipping alliances will continue to grow and change in the years to come.
It’s clear that shipping alliances are an important part of maintaining worldwide oceanic freight coverage. Just as the industry has evolved in the past, shipping alliances are going to continue to grow and change to address any issues for consumers, companies and the economy. For more information on shipping alliances and how they impact you, read our blog.