Maritime Divorce Puts Maersk’s Strategy To Test

Credit: galen-crout-unsplash

As Danish shipping company seeks to transform into a broader logistics group, it faces rising competition from MSC, reports Financial Times.

Time to unwind?

AP Møller-Maersk, the world’s second-largest container shipping company, may regret the decision in 2015 to embrace its once smaller rival Mediterranean Shipping Company in a vessel-sharing alliance. Then, the logic was that by sharing capacity in tough times, the two could keep down costs and prices, while still offering a global network of routes.

But, while sheltering in the partnership, MSC has been able to grow so quickly that it has leapfrogged Maersk to become the world’s biggest container shipping line by capacity. In the process, it has learnt much about service and reliability from its rival. In November last year, MSC ousted Maersk as the world’s most reliable container shipping operator in terms of punctuality.

Now the two companies say they will not renew their partnership in 2025 and it will begin to unwind just as times are getting tough again. They insist that the decision to divorce was mutual. But it is clear that the alliance brought many more benefits to MSC — as does the timing of its demise.

Read the full article here.

Did you subscribe to our Newsletter?

It’s Free! Click here to Subscribe.

Source: Financial Times


This site uses Akismet to reduce spam. Learn how your comment data is processed.