|
IF
there was anything one could take-away from
October's TPM conference in Shenzhen
it was that mega-alliances that now dominate
the trade lanes worldwide, have had a largely
positive effect of the world's most important
trade lane.
While
conceding that there needs be checks and
balances, one important shipper - Electrolux
- said the usual shipper paranoia about
carrier collusion was subsiding, though
the fever still ran high among regulators.
Said
NYK chief executive Jeremy Nixon: "The
EU still has a mindset of collusion. That's
unfortunate, it hasn't been like that for
years, but smoke-filled rooms still permeates
their thinking.'
Said
Bjorn Vang Jensen, vice president of supply
chain for Electrolux Asia Pacific."If
the current shipping market is the result
of collusion, then we need more, because
you guys are the worst collaborators in
history."
Not
that there wasn't a downside. The lemming-like
stampede towards mega-ships was worsened
by alliance vessel sharing agreements, which
has each member company rely on others to
fill its ships.
This
is quite apart from the usual finding that
large ships that dominate the Asia-Europe
trades produce the over capacity that drives
down freight rates, he said.
Alliances,
also called consortia, have been around
since 1967, he said. "Alliances aren't
perfect, but an unavoidable solution to
the intractable problem that this industry
can't seem to consolidate," said Mr
Vang Jensen.
"Building
these large ships has become the price of
entry. People aren't going to invite you
to dance unless you have the tools. This
flywheel effect is going to drive disaster
in the industry," he warned.
Mr
Vang Jensen, formerly vessel scheduling
manager for a shipping consortium: "I
feel your pain, but they [alliances] give
shippers choice."
He
said he was aware of discussions among major
carriers, with big ones saying they do not
favour alliances because they allow smaller
carriers to exist "longer than they
should".
"As
a shipper, as a consumer, container shippers
only have one choice, and I need the little
guys and the big guys to be around. So,
I accept the alliances, they come with a
ton of operational issues. For us, not just
for carriers." he said.
Said
NYK's Mr Nixon: "There are legal constraints,
particularly in Europe, where the EU is
not particularly keen about further integration."
Another
downside, he said, is that alliances reinforce
commoditisation. "How do you differentiate
yourself, other than on price, when you
just have the same move from A to B."
All
member lines use the same feeder, the same
trucker, the same barge, he said "How
do you differentiate yourself? That's a
key issue because unless lines can differentiate
themselves, that's a potential risk,"
he said.
Rod
Riseborough, CEO Container Trade Statistics,
pointed out that the new mega-alliances
share similarities with rate-setting consortia
or shipping conferences of yesteryear, but
also exhibit important differences.
"Today,
we're down to four major alliances,"
he said. "If you look at the first
three alliances, they operate out of Asia-Europe
trade.
"They
are not perfect, but I think given the state
of the world trade and the state of the
larger trade. I think it works, it makes
sense for the alliances to do what they
are doing," he said.
I
think one of the problems some alliances
have is that they are all different. They
are treated differently in terms of what
they can and can't do," said Mr Riseborough.
He
pointed to differences in what they could
do in regard to moving cargo inland. "So,
I think we have to accept what works on
one trade, doesn't work on another.
"There's
more to it than just a bunch of alliances
being put together. I think that's one of
the problems the industry has to face,"
he said.
"Where
alliances fail, is in providing too much
capacity, If you are going to build ship
now, nobody wants to build anything less
than 13,000-TEU. Being in an alliance, it
seems one must build 13,000-TEU ships, even
if you cannot fill them, because the guy
next door's going to fill them for you,"
said Mr Riseborough.
"But
he's also building ships he can't fill and
he's looking at you to fill them. So, the
ability of the alliances to manage capacity,
if you build a big ship, you're damned if
you do and you're damned if you don't,"
he said.
"So,
I think the ability of the alliances to
manage capacity, and I'm not talking about
taking out steamings, I'm talking about
gross capacity, has proven there's a lot
more to do," Mr Riseborough said.
Said
NYK's CEO Mr Nixon: "It's a good point,
when we talk about managing capacity, we
get these peaks and troughs, so I think
alliances are pretty good at managing the
weekly, week in, week out, supply matching
up with demand.
"The
G6 [of which NYK is a member) will take
out services during winter, but planning
capacity going forward is difficult because
you've got four major alliances out there.
Some of those guys have over ordered,"
he said.
"In
the G6, we plan our tonnage on a more consistent
basis. If you look at the ordering of those
six members, in terms ordering in the 13,000
and 14,000-TEU ships, they weren't ordering
at the same time," said Mr Nixon.
"We
haven't rushed out for the 18's and 19's,
we've taken a more cautious position on
that. But two of our members, two out of
the six have ordered 18,000 TEU ships, which
will come in 2017," said Mr Nixon.
"So
you've got to look at the data, you've got
to look at the specifics, but generally
I would say the G6 has been reasonably consistent
in our supply demand management," he
said.
|
