Apr 22, 2016

CMA-CGM/COSCO/Evergreen/OOCL alliance to be launched April 2017

Top executives of the four liner operators attended a ceremony in Shanghai.

CMA-CGM, COSCO Container Lines, Evergreen Line and OOCL have agreed that they will establish Ocean Alliance, a new alliance, and move on to set up a new structure for it accordingly. Joined by OOCL in alliance with the world third (CMA-CGM), fourth (COSCO) and fifth (Evergreen) containership operators, it will occupy 23% of the share on the East-West routes, the second largest to 2M by Maersk Line and MSC. Meanwhile, the next focal point is how CKYHE, bolted by COSCO and Evergreen, and the remaining carriers of G6 Alliance, seceded by OOCL in addition to APL, will respond to the new alliance's emergence. Negotiations looking for the third alliance are to shift into full swing in a struggle for survival.

The four liner operators will, through Ocean Alliance, transfer the services on the East-West routes to new ones as from April 2017. This partnership is intended for Asia-Europe, Asia-Mediterranean, Asia-Middle East, Asia-Red Sea, Pacific Ocean (Asia-North America West Coast), Asia-North America East Coast, and Atlantic Ocean routes, which features, compared with the other alliances, inclusion of Middle East and other routes.

According to the announcement, the new alliance plans to make a five-year partnership starting from next year, on acquiring approvals from related authorities. The four companies plans to deploy 350 boxships, resulting in a service structure of more than 40 loops centering on to/from Asia routes as of the onset of the alliance next April, although its specific service framework has not yet been announced. The alliance also plans to provide services of about 20 loops each on the routs to/from Europe and U.S.

Rodolphe Saade, vice chairman of CMA-CGM, said of the formation of the alliance that, "We will be able to provide more comprehensive service and competitive transit time via the services of more than 40 loops we offer with new partners." Wang Haimin, vice president of COSCO Container Lines stated, "Ocean Alliance is more suitable for our global strategies. We will provide more excellent services through the partnership." Lawrence Lee, CEO of Evergreen, commented, "We will be able to optimize the deployment of bottoms via the new alliance, offering more competitive services." Andy Ton, CEO of OOCL, also said, "The alliance will become a platform for our ongoing efforts to beef up cost and business efficiency".

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