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Transformations in the Shipping Industry: Hapag-Lloyd and Maersk Redefine Alliances

The shipping industry undergoes significant changes with the establishment of the Gemini Cooperation between Hapag-Lloyd and Maersk, challenging existing alliance structures and leaving certain Asian carriers bewildered. Reliability becomes the cornerstone of this new collaboration, marking a milestone in east-west trade routes.

In a surprising twist, Hapag-Lloyd has discarded its current alliance structure with THE Alliance by partnering with Maersk from February next year. This decision has left THE Alliance with a reduced global presence, disrupting its original composition of Hapag-Lloyd, HMM, Ocean Network Express (ONE), and Yang Ming.

Maersk’s existing partnership with Mediterranean Shipping Co (MSC), 2M, is set to expire in a year, and the Danish shipping line has been actively seeking a partner to cover capacity gaps. The new collaboration, named the Gemini Cooperation, aims to improve schedule reliability to 90%, making a significant difference compared to the competition.

Rolf Habben Jansen, CEO of Hapag-Lloyd, noted that “insufficient progress” in reliability was a key reason for leaving THE Alliance, emphasizing the need to elevate quality, customer satisfaction, and sustainability. Johan Sigsgaard, Executive Vice President of Maersk, confirmed that reliability is a critical point for customers and detailed a four-year contract with “financial consequences” if an alliance partner fails to meet agreed-upon quality standards.

The new collaboration will operate with a combined fleet of around 290 vessels and a total capacity of 3.4 million TEU, with Maersk and Hapag-Lloyd contributing 60% and 40%, respectively. Twenty-six mainline services covering seven key trade routes will be established.

In conclusion, the creation of the Gemini Cooperation redefines alliances in the shipping industry, triggering a transformation in competition and service reliability. Hapag-Lloyd’s departure from THE Alliance raises questions about the future viability of this alliance. The focus on improving service quality and customer satisfaction underscores the importance of reliability in an increasingly competitive business environment.

Source: Information based on Lloyd’s List and Maersk