Source: updated from Notteboom, T. (2012), Chapter 12: Container shipping, in: Talley, W. (ed.), The Blackwell Companion to Maritime Economics, Wiley-Blackwell Publishing, ISBN: 978-1-4443-3024-3, pp. 230-262.
Operational cooperation between container shipping companies comes in many forms ranging from slot-chartering and vessel-sharing agreements to multi-trade strategic alliances. The first strategic alliances between shipping lines date back to the mid-1990s, which coincided with the introduction of the first post-Panamax container vessels in the Europe-Far East trade. In 1997, about 70% of the services on the main East-West trades were supplied by the four main strategic alliances. The alliance partnerships evolved due to mergers and acquisitions, such as the merger between P&OCL and Nedlloyd, the take-overs by P&O Nedlloyd and SeaLand by Maersk, and the market entry and exit of liner shipping companies.
In early 2023, three alliances were operational globally: 2M, Ocean Alliance, and THE Alliance. However, in late January 2023, MSC and Maersk announced they mutually agreed to discontinue the 2M alliance, set to end in January 2025. This implies that the 10-year agreement, which was signed in 2015, will not be extended. Both carriers already began to make changes to their liner service networks before 2025. The announcement on the termination of 2M (combined with the termination of the EU Consortia Block Exemption Regulation (CBER) from April 2024 onward) triggered the start of an industry-wide re-shaping of existing operational agreements, especially on the major east-west trades. In January 2024, Hapag-Lloyd announced that the carrier will leave THE Alliance. From February 2025, Hapag-Lloyd will start a new cooperation scheme with Maersk under the name ‘Gemini Cooperation’. As things stand now, by 2025, MSC will remain the only large container shipping line not being part of an alliance. In early 2024, MSC operated a fleet (owned and chartered) of about 5.6 million TEU, with an order book of an additional 1.4 million TEU.
Initially, many of the largest carriers did not opt for alliance membership. These firms reached a sufficient scale to benefit from the same economies of scale and scope that strategic alliances offer. Some of the top carriers at that time, which were Maersk Line, MSC, CMA CGM, and Evergreen, were notable examples. In comparison, the remaining two top-six carriers (i.e. COSCO and Hapag-Lloyd) have always opted for alliance membership despite the scale of their activities. Several shipping lines, such as Evergreen, initially did not participate in alliances due to commercial independence and flexibility. However, in the 2010s, even the largest shipping companies resorted to joining alliances as a competitive strategy and to increase margins. The case of Evergreen demonstrates that even outsiders have had to pursue alliance membership.
The main incentives for shipping lines to engage in strategic alliances are the need for critical mass in the scale of operation, enhancing global reach, improving fleet deployment, and spreading risks associated with investments in large container vessels.
Alliances also come with some impediments for members, particularly at the level of a loss of operational and strategic independence and regulatory headaches.