Shipping Lines May Shuffle Alliances

Shipping group CMA CGM SA, which is close to completing its acquisition of Neptune Orient Lines Ltd., may abandon its operating alliances with other carriers amid growing consolidation in the container shipping business.

“We are becoming a larger shipping line, and we are in the position to select the partners with whom we want to do business,” said Rodolphe Saadé, Vice Chairman of CMA CGM.

The Ocean Three alliance agreement, which also includes United Arab Shipping Co. and China Shipping Group Co., concludes at the end of 2016.

The alliances, in which shipping lines share space on each other’s vessels, have emerged as operators sought to reduce costs and increase efficiencies with megaships.

Because of CMA CGM’s large share of the shipping market, any action it takes would likely trigger a reshuffling of lineups that take in the world’s largest carriers.

“There are many rumors in the market about who we are talking to,” Saadé said. “In our industry everybody talks to everybody."

China Shipping recently completed a deal to merge with China Ocean Shipping Co., a member of another global alliance.

Source: The Wall Street Journal  S