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More capacity today as alliances set sail: World Liner Supply

THE debut of THE Alliance and the OCEAN Alliance caused a rise in capacity on the transpacific trade, while a slight drop on the Asia-Europe and transatlantic market by the close of the first quarter 2017, according to the latest quarterly World Liner Supply (WLS) report from BlueWater Reporting.

More capacity today as alliances set sail: World Liner Supply

THE debut of THE Alliance and the OCEAN Alliance caused a rise in capacity on the transpacific trade, while a slight drop on the Asia-Europe and transatlantic market by the close of the first quarter 2017, according to the latest quarterly World Liner Supply (WLS) report from BlueWater Reporting.

More capacity today as alliances set sail: World Liner Supply
24 April 2017 - 20:00

In the first quarter of 2017, overall ocean carrier capacity witnessed a slight boost in three out of the four major east-west trades (transpacific, transatlantic, Asia-Europe and Asia-US east coast), as carriers reshuffled in a lead up to the dissolution of the CKYHE, G6 and Ocean3 alliances into the inauguration of the OCEAN Alliance and THE Alliance in the first week of April 2017.

Not to be left out, the remaining 2M Alliance took on Hamburg Sud and Hyundai Merchant Marine (HMM) as slot purchasers in their east-west service network, American Shipper reported.

The industry also saw new South Korean liner carrier SM Line acquire former Hanjin operated vessels with the intentions to enter the competitive transpacific market.

With the newly overhauled alliance structure, overall deployment in the first quarter was still higher at the end of first quarter 2017 in the transpacific trade lanes and lower in the Asia-Europe and transatlantic trades than that of first quarter 2016.

Weekly capacity from Asia to the West Coast of North America increased 5.5 per cent during the quarter, from 266,604 TEU at the end of Q4 2016 to 281,295 TEU at the end of Q1 2017.

Deployed weekly capacity from Asia to the east coast of North America also took an upturn, increasing 8.4 per cent, from 115,212 TEU at the end of the fourth quarter to 124,849 TEUs at the end of Q1 2017, after a 5.8 per cent drop the previous period.

BlueWater Reporting tracks the weekly TEU capacity of competitive direct liner services on 30 individual lanes operating between Asia, Europe and North and South America for the WLS report, taking into account skipped sailings and slow steaming, and estimates the allocation of that capacity within each specific trade lane.

Overall, weekly capacity in the eastbound transpacific trade lane increased 6.4 per cent to 406,144 TEU by the end of the first quarter after a fourth quarter in which weekly deployment stood at 381,816 TEU.

Market share for the former alliances at the end of Q4 2016 saw member carriers of the G6 Alliance in the lead at 29.73 per cent, CKYHE at 20.90 per cent, and the Ocean 3 at 9.79 per cent. The 2M Alliance also held an 18.01 percent market share in the trade by the end of the fourth quarter.

The new alliance structure sees the OCEAN Alliance with a 36.44 per cent in market share in the eastbound transpacific trade; THE Alliance with 27.86 per cent and the 2M Alliance at 18.94 per cent by the end of the Q1 2017.

Non-alliance affiliated carriers saw capacity drop significantly from 82,364 TEU to 68,055 TEU during Q1 2017, causing their combined market share to drop from 21.57 per cent to 16.76 per cent in Q4.

Unlike the transpacific, the highly competitive Asia-North Europe trade saw overall weekly capacity slightly drop from 221,195 TEU to 217,330 TEU.

Market share for the 2M Alliance took the lead with 39.70 per cent of the overall share, with the OCEAN Alliance at 34.11 per cent and THE Alliance at 25.48 per cent at the close of Q1 2017.

Non-alliance lines continue to have little involvement in the westbound Asia-North Europe trade with just 0.71 per cent of the total market share, with the exception of a few slot-purchasing agreements.

Overall, capacity in the transatlantic trade also dropped slightly, decreasing one per cent for the quarter, from 69,459 TEU to 68,768 TEU.

THE Alliance members maintained the top spot with weekly deployed capacity at 20,872 TEU and a 30.35 per cent market share. Non-alliance services claimed a large portion of the trade at 26.66 per cent by the end of Q1 2017.

The 2M remained fairly steady in the transatlantic trade with a market share of 22.81 per cent, slightly up from 22.71 per cent during the previous period. The OCEAN Alliance rounded out the grouping with a market share of 20.18 per cent.

Weekly deployed capacity remained marginally unchanged for members of the 2M Alliance at 15,683 TEU, while THE Alliance members deployed 20,872 TEU s and the OCEAN Alliance deployed 13,877 TEU.

Non-alliance affiliated carriers removed 14,231 TEU of weekly deployed capacity in the transatlantic trade, decreasing by 4,851 TEU at the end of Q4 2016 to 18,336 TEU at the end of Q1 2017.

 

 

 


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