HMM leaves 2M for THE Alliance

HMM leaves 2M for THE Alliance

South Korean line HMM has been accepted into THE Alliance, becoming the fourth member of the liner grouping set up by Hapag-Lloyd, Ocean Network Express and Yang Ming in 2016.

HMM will join the alliance as a full member, with a new contract between the four lines set to officially start on April 1, 2020. Additionally, all four members have agreed to extend the partnership for 10 years through to 2030.

Previously, HMM was aligned to the Maersk and MSC alliance 2M, but was only able to negotiate a vessel sharing agreement which was due for renewal next April.

Jae-hoon Bae, president and CEO of HMM, commented: “Being a full member of THE Alliance gives us a lot of pride. We are convinced that we will be successful and generate additional value for our customers, employees and shareholders with combined experience, strategic skills, competitive fleet and strong focus on our clients´ needs.”

HMM currently has twelve 23,000 teu and eight 15,000 teu vessels on order. The 23,000 teu vessels will be deployed in the Far East – North Europe trade, which THE Alliance expects to strengthen its offering.

Commenting on the news, Copenhagen-based container analyst Lars Jensen looked at what the HMM switch will mean for the transpacific trades in a post he wrote on LinkedIn yesterday. THE Alliance will match the Ocean Alliance on the transpacific with 19 services come next April, while 2M will drop to just 11 services.

Grant Rowles

Grant spent nine years at Informa Group based in London, Sydney, Hong Kong and Singapore. He gained strong management experience in publishing, conferences and awards schemes in the shipping and legal areas, working on a number of titles including Lloyd's List. In 2009 Grant joined Seatrade responsible for the commercial development of Seatrade’s Asia products. In 2012, with Sam Chambers, he co-founded Asia Shipping Media.

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3 Comments

  1. Avatar
    Chris
    July 1, 2019 at 8:21 pm

    Interesting, so HMM could see more value from THE alliance over 2M? does that imply as the smaller member of 2m that it wasn’t considered an equal member to MSC and Maersk? or are there other strategic or operational factors in play?

  2. Avatar
    Peter
    July 1, 2019 at 11:14 pm

    Previous 2016 agreement said: “2M would accept HMM as a full membership company based on an assessment of HMM’s financial structure and liquidity improvement”, so, draw your own conclusions…

  3. Avatar
    Alf Ellis
    July 2, 2019 at 5:31 pm

    You are assuming that HMM wanted to stay in 2M. I don’t believe they did. Better to enter into an agreement where their new tonnage will be welcomed rather than remain in one where they are not. Furthermore, it never looked likely that they would be anything more than a slot charterer with 2M – their status within THEA is beneficial for them and also for the existing members, who I would imagine will soon be announcing another loop, plus some adjustments to their existing products.

    I think it is good news for all parties.