The alliance formed by Maersk and Mediterranean Shipping Company was established in 2014 to improve the competitiveness of the two companies in the shipping field. However, due to the intensification of market competition and various challenges facing the global shipping industry, making the operation of the 2M alliance difficult, the first sign of the dissolution of the 2M alliance may appear in the Asia-Europe trade, Maersk and Mediterranean Shipping Company did not resume the Nordic route suspended in December last year. Instead, MSC is using its massive orders to scale up existing services and launch new ones. As a result, the two companies decided to dissolve the alliance in 2023.
just a few weeks before the dissolution of one of the alliance's six Asia-Nordic routes, 2M alliance members announced that their ship-sharing agreement would end in 2025. Alphaliner pointed out that Maersk and MSC closed the AE1/shogunate route in December last year, which was the first major alliance route in Asia-Europe trade to be officially closed.
as ships begin to come into service in significant numbers, MSC is poised to take delivery of a large number of oversized vessels, with five vessels 24000 TEUs to be delivered in April and May and a further nine vessels 19000 to 24000 TEUs to be delivered by the end of the year. According to the Alphaliner, four of the giant ships will be deployed on the 2M Asia-Nordic AE6/Lion route starting this month, making it the largest of all the loops in the alliance, with an average capacity increasing from 20,300 TEU to 22700 TEU per week.
In a major injection of capacity into the Asia-Mediterranean trade, MSC on Wednesday launched the revamped Dragon service, one of four 2M routes suspended in May 2020, which will connect Asia with Israel, Italy and southern France and provide the fastest transit time into the Mediterranean. As a new independent loop, the improved Dragon service will continue to focus on the French and Italian markets, but will not call at any Spanish port or Beirut, directly at the ports of Ashdod and Naples.
The re-launch of the Asia-Mediterranean route after two years in allowed MSC to take advantage of its abundant capacity, which was more attractive than the Nordic route from a price point of view. Data from interest rate benchmark platform Xeneta shows that the 90-day Asian-Nordic average spot rate in effect this week is $1,616 per FEU, while the Asian-Mediterranean rate is $1,616 per FEU and $2.740 per hour.
Structural Overcapacity
The latest round of price competition in has led to a sharp drop in interest rates. Container trade statistics in November showed that trade volume from Asia to Europe and the Mediterranean fell by 1% year-on-year to 30000 TEUs. As demand varies on trade routes where capacity is oversupplied, operators compete for the number of vessels to fill by offering discounted rates, and price competition leads to a significant reduction in interest rates. Carriers are suspending or adjusting service in pursuit of changing freight volumes.
MSC has expanded its Asia-US West Coast independent Sentosa service to North India and Sri Lanka, while Maersk has announced the suspension of its independent Southeast Asia-US East Coast TP20 service.
CMA CGM launched its Americas XL service connecting the East Coast of the United States and the West Coast of South America in December, the Zim Integrated Shipping Service (Zim) has increased the capacity of its own US East Coast-West Coast South America service.
Zim suspended expedited trans-Pacific service from China to the U.S. West Coast while increasing service capacity connecting the growing Southeast Asian market and the U.S. East Coast. The Israeli carrier also launched a direct service between the west coast of South America and the east coast of the United States.
Forwardernet.com
