The partnership between the two biggest ocean shipper companies will come to an end when the mandatory ten-year agreement period expires in 2025. Maersk and MSC will go their separate ways after sharing vessels for ten years, possibly resulting in significant changes or fragmentation within the ocean carrier industry.
Biggest Ocean Shipper – Why Split The Band Up?
Why not keep the good times going? Maersk and the MSC are changing their business strategies. Maersk wants to target end-to-end logistics, instead of just focusing on ocean shipping. As a result, the two companies have decided to stop working together and become independent again.
Ocean Shipping Industry Fall Out
According to some experts, the dissolution of the 2M alliance may trigger a series of changes in the shipping industry, as other major alliances, such as Ocean Alliance and THE Alliance, attempt to take advantage of the situation and safeguard their profits from potential threats.
Covid Catalyzed the Split in Maritime Models
The 2M alliance aimed to provide Maersk and MSC with massive shipping capacity by allowing them to utilize each other’s vessel space, thereby fostering a mutually beneficial partnership.
Nevertheless, due to the alterations in the maritime shipping landscape caused by the COVID-19 outbreak, along with the existing economic downturn and inflation concerns, the two corporations reached a mutual decision to terminate the agreement once the designated ten-year period concluded, as it would be beneficial for both parties.
What Happens Next to Ocean Shipping’s Biggest Players?
As previously mentioned, Maersk is seeking to reposition itself by entering the overall logistics industry. Concurrently, MSC has significantly increased its cargo capacity by implementing a shipbuilding initiative, which will result in the addition of more than 100 new vessels to its already immense fleet. For example, MSC’s newest crown jewel to its fleet is The MSC Tessa, with an industry record capacity of 24,116 TEU. For reference, a TEU is a Twenty Foot Equivalent Unit aka, a 20’ft shipping container.