Shippers Comment on Drewry’s Statement about New Alliances Having Limited Effect

Shipping consultancy Drewry predicts that even with the creation of the Ocean and THE alliances in 2017 there will be no big impact on the announced schedules, and a constant reduction of service frequency in North European ports may soon be over.

There has been a decrease of loops, e.g., 10 percent in the east-west trade. And with the average ship size increase of 4.3 percent, the alliances use this reduction of the number of loops to compensate partly for the overlap vessel capacity.

However, the situation is not playing in shippers’ interests and it does not benefit the other stakeholders in the supply chain. Clearly, increasing the size of ships to balance a decrease of calls in Europe creates peeks in ports, raises the level of congestion in hinterland, and undermines the optimal use of infrastructure and staff. Since the first round of consolidation in 2015, there has been fewer and fewer ports called, and fewer calls per port received. So, regrettably, new alliances can raise the total cost of a supply chain and make the status quo of low service quality prevail in 2017.