UK based Paul Richardson is a keen observer of the shipping schedules of container ship operators. With regulatory hurdles looming on the horizon, “this one still has a long ways to go,” but an early view of the proposed rotations sketches out the global scope of the P3 Network.
The scale of the P3 Network is staggering with the new Asia/Europe, Transpacific and Transatlantic schedules deploying a total of 252 vessels offering a combined capacity of 2.6-million teu spread over 28 separate weekly loops. If all goes well for the consortium, it should start operations in the second half of 2014. The indisputable weight of the Maersk/MSC/CMA-CGM collaboration potentially could decided which Terminal Operators (and ports) will be winners and those who will be losers in the global high stakes battle for slot supremacy. It has already been suggested that ports such as Antwerp could be a winner at the expense of the mega-port of Rotterdam. The pressure is also on terminal operators (and port administrations) in places like the Port of Hamburg and up and down the US East Coast to provide channel depths in excess of 50-feet to accommodate the new generation of 10,000 TEU plus (up to 20,000 TEU) vessels. Nevertheless, with regulatory procedures and various questions from the authorities still to be answered, the future of the P3 Network still remains very much in the balance in a “will it, or won’t it happen” scenario. On the face of it all, there is not a lot of difference in capacity terms (for example less than 2.5% on Asia/Europe trade route), from the existing individual Maersk, MSC and CMA-CGM service structures on the main East/West sea routes, and the proposed P3 Network service program. But one of the exceptions stands out on the North Atlantic trade routes - it is the service covering North Europe and the US East Coast, deploying the US-flag vessels, which stands to more than double the existing service operating on this trade lane. However, before we go into the details of how it’s all going to look, a lot has happened since the service announcements were first made several weeks ago – the authorities have stepped in with rather large footprints, and there is going to be a “Global Summit” to be held in Washington DC to discuss the whole setup months before the official due up date. Commissioner William Doyle has already underlined his concern over the P3 Network total vessel fleet, and also the impact on the US trade, as well as a wish that there will be “no negative impact on the US-flag international fleet when decisions are made to cascade vessels into the alliance, or eliminate them from the network.” Commissioner Richard A. Lidinsky, Jr. has also stated “It is clear this alliance is moving forward as if it has already met regulatory approval despite the lack of any significant filing with regulatory authorities in Europe, China or the US. In Europe the P3’s market share between Asia and Europe will exceed the 30% maximum allowed by the EU’s Consortia regulations, which undoubtedly will raise red flags. “Pushing behind the scenes and placing positive stories with the press is not a substitute for proper consideration of the consequences of this massive carrier alignment.” In addition to this, the FMC (Federal Maritime Commission) is keeping mind on the parameters and the impact of the P3 Network agreement, but clearly states that together with its European and Chinese counterparts, “We as regulatory authorities, have responsibilities related not only to our nations, but to the global shipping structure to ensure that this proposed Alliance does not harm others, including consumers, the maritime community, and world trade”, is the official reaction of the FMC chairman. North Atlantic Exception So this one has a long way to go yet, but here are the details of how the plan will work if the official nod is given. Five new services are confirmed under the proposed P3 Network, and they all replace existing services under Maersk/MSC/CMA-CGM with almost matching capacity numbers …all that is apart from one. The TA3/US Gulf/Equality Bridge service will operate with US-flag vessels, but instead of the present TA2 US-flag service offered by Maersk with 4,800 teu vessels covering Rotterdam, Felixstowe, Bremerhaven, New York, Charleston, Savannah, Houston, Mobile, Miami, Norfolk and back to Rotterdam, the new US-flag setup will change dramatically in capacity terms, and with a different port coverage. Under the proposed new service, the TA3/US Gulf/Equality Bridge coverage will be: Rotterdam, Felixstowe, Bremerhaven, Le Havre, New York, Charleston, Savannah, Houston, New Orleans, Mobile, Freeport, Norfolk, Antwerp. The more important point will be that capacity will become six (6) x 8,500 teu vessels, almost twice the existing North Atlantic US-flag service capacity. (See related P3 service charts for more detailed information) Another important note is that all transatlantic services covering the North Atlantic/St Lawrence trade lane will remain unchanged from present scenario. It is worth noting that the Port of Montreal recently announced that it could handle 6,000 TEU ships. Over on the Asia/USWC trade, there will be five separate services: TP6/Pearl/PRX1; TP1/Eagle/PRX2; TP2/Jaguar/Yangtze; TP8/New Orient/Bohai; and TP5/Sunrise. On the Asia/USEC trade, the P3 Network adds four more, the first three with Suez transit, the fourth through the Panama Canal: TP11/Empire/Columbus; TP12/America Service; Atlantic Service; and Everglades Service. Eight more services will cover the Asia/North Europe trade: AE1/Albatros/FAL1; AE2/Lion/FAL2; AE5/Shogun/FAL3; AE6/Condor/FAL5; AE7/Swan/FAL6; AE8/Baltic/FAL7; AE9/Skaw/FAL8; and AE10/Silk/FAL9. Finally the Asia/Mediterranean trade and five more services: AE15/Tiger Service/AEGEX; AE12/Phoenix/PHOEX (pendulum); AE3/Black Sea/BEX; AE20/Dragon/WMED1 and AE11/Jade/WMED2. What Does it All Mean? Although it’s premature to read too much into the proposed P3 Network schedules in advance of the regulatory salvoes yet to be fired, a few points might be inferred from the early announcements. With the establishment of a centralized scheduling coordinating office in Singapore the P3 is attempting to organize schedules on a hitherto unknown scale. This fits in with Maersk Line’s concept of the schedule reliability of the “Daily Maersk” program between Asia and North Europe. The deployments to North America show increases of roughly 8% on the West Coast and 5% on the East Coast, which indicates a belief that market will improve. Most of the deployments involve larger line haul vessels. It remains to be seen how the cascading impact of trans shipment services and individual service schedules of the three carriers will integrate into the P3.