Shipping alliances: Advantages [+ HMM, ONE and Yang Ming update ‘24] (2024)

Shipping alliances enable carriers to share their resources effectively. Read this blog to learn about the new alliance formed by HMM, ONE and Yang Ming. We’ll also discuss the Gemini Cooperation and the end of the 2M Alliance.

In the shipping industry, low pricing and wide service coverage are two important elements that carriers must offer to make their business profitable. To facilitate this, three major shipping alliances (2M, THE Alliance and Ocean Alliance) were formed. Shipping alliances allow carriers to increase their customer base globally and offer low prices.

In January 2023, two major carriers, Maersk and MSC, called off their 2M Alliance, and will completely separate their operations by 2025. Almost a year later, Maersk and Hapag Lloyd announced their groundbreaking alliance all set to come to fruition in 2025. Recently, Ocean Network Express (ONE), HMM and Yang Ming Marine Transportation (Yang Ming) announced that they will cooperate closely under the new Premier Alliance for 5 years from February 2025.

Keep reading to learn more about this new operational collaboration. But before that, if you’re interested in keeping yourself up-to-date with major events in the industry – such as the latest shipping alliances – we’ve got the perfect solution for you.

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What are shipping alliances?

A shipping alliance, often referred to as an ocean alliance, is a group of ocean carriers that create a cooperative agreement together. This agreement covers several trade routes through collaboration among its members on a global scale.

These groups of carriers commit to vessel-sharing agreements to help cover as much of the shipping market as possible. This means they gain access to vessels owned by other carriers. Often, carriers also agree to move containers on behalf of one another.

Shipping alliances allow carriers to create a monopoly over the ocean shipping market. Based on Alphaliner’s ranking of all the shipping lines, the 3 major alliances collectively account for 80% of the global container market. Leaving just 20% for the other smaller global/regional carriers.

Let’s learn more about these 3 major alliances, as well as the newest cooperation starting in 2025.

Major global shipping alliances

Here’s an overview of the current major shipping alliances, and the changes that will be taking place over the next year:

Premier Alliance: HMM, ONE and Yang Ming (February 2025)

HMM, Ocean Network Express (ONE), and Yang Ming Marine Transportation announced their plans to collaborate in liner trades under the new Premier Alliance, which will run for 5 years starting in February 2025.

Currently, these three companies are part of THE Alliance alongside Hapag-Lloyd. Earlier this year, Hapag-Lloyd announced it would join Maersk in the new Gemini Cooperation starting in January 2025. Hapag-Lloyd’s decision came after Maersk and MSC announced the end of their 2M alliance in 2023.

Following the recent container alliance changes, MSC will be operating independently.

The Premier Alliance members will operate on key East-West routes, connecting Asia to the North America West Coast, North America East Coast, the Mediterranean, North Europe, and the Middle East. They provided an updated overview of their services across these trade lanes in their official press release.

In addition, the group revealed a slot exchange agreement with MSC for nine Asia-Europe services, as MSC prepares to operate outside of the 2M alliance.

“Collectively this new tripartite alliance will offer strong, reliable and highly dependable end-to-end direct port container services to its customers on both the Transpacific and Asia-Europe trades” announced Jeremy Nixon, the CEO of ONE.

Gemini Cooperation: Maersk and Hapag Lloyd (January 2025)

Shipping powerhouses Maersk and Hapag Lloyd announced the signing of a long-term operational collaboration – the Gemini Cooperation – starting February 2025.

This new partnership between the world’s second and fifth-largest shipping companies will consist of 290 ships with a total capacity of 3.4 million TEUs. Maersk will operate 60% of this capacity, and Hapag Lloyd the other 40%.

The Gemini Cooperation will cover:

• Asia and North Europe
• Asia and the Mediterranean
• Asia and the Middle East
• The Middle East to India and Europe
• Asia and the US East Coast
• Asia and the US West Coast
• The Transatlantic

The goal is for ships to reach ports on time for at least 90% of departures. Besides this, the shipping lines believe this alliance will make it easier for them to reduce CO2 emissions from their ships.

What’s the Impact of the Gemini Cooperation on other shipping alliances?

There’s no doubt that the new cooperation will leave other shipping companies seeking out new partnerships. This is especially true for the remaining members of THE Alliance; Ocean Network Express (ONE), HMM and Yang Ming.

Simon Sundboell, founder of consultancy eeSea, said on a LinkedIn post; “Hapag-Lloyd, whose capacity is nearly 1.98 million TEUs, is the largest of THE Alliance’s members, and the grouping will not survive without it.”

With the exit of Hapag Lloyd, THE Alliance will have about 3.3 million TEUs. The newly formed Gemini Cooperation will be slightly ahead with 3.4 million TEUs. This makes the Ocean Alliance the largest group, with 8.3 million TEUs.

With a deduction of 1.98 million TEUs, THE Alliance is sure to be scrambling to find new members as soon as possible.

Sundboell further states, “Even CMA CGM and Cosco will be looking over their shoulders in Ocean; do they want to snap up the remaining THE Alliance carriers, and if so what’s ‘the price’?”

With the recent extension of the Ocean Alliance until 2032, any speculation about this partnership breaking up has been put to rest, as they’ll be working together for the foreseeable future.

2M Alliance: Maersk and MSC (terminating 2025)

The 2M Alliance was formed in 2015 between Maersk and Mediterranean Shipping Co (MSC). The cooperation covered the Asia-Europe, trans-Pacific and trans-Atlantic trade routes. The HMM also joined 2M in 2017 for a three-year partnership, but later teamed up with THE Alliance instead.

End of 2M Alliance and its impact

In January 2023, Maersk and MSC jointly announced their discontinuation of the alliance by 2025. The announcement of 2M’s termination may signal the beginning of a broad industry-wide restructuring of current operational contracts, particularly on the important east-west trades.

So how does this discontinuation affect others in the shipping industry? Both companies together control about one-third of the world’s container capacity. What’s more, they have over 4 million TEUs independently.

• For starters, it’ll create more competition between Maersk and MSC. Freight forwarders may notice a fall in shipping rates, as both companies compete more directly in the Asia-Europe, Transatlantic and Transpacific trade routes.
• Similarly, if you’re a customer of Maersk or MSC, you may also notice some positive changes in the services offered in the coming years – aiming at retaining and attracting more customers.
• Experts also believe that both companies will have to increase their ocean fleet to keep up with their customer’s demands and ensure smooth cargo transportation.

Ocean Alliance: COSCO, OOCL, CMA CGM & Evergreen

The Ocean Alliance was launched in 2017 for an initial period of five years between COSCO Shipping, OOCL, CMA CGM, and Evergreen. In 2019, the companies confirmed an extension of the alliance to ten years (until 2027). In February, 2024, the alliance announced a further five year extension, starting from 2027.

The Ocean Alliance includes 330 container ships and an estimated carrying capacity of 3.8m TEUs. This alliance also has Ever ACE, the largest mega ship with a capacity of 23,992 TEUs.

Ocean Alliance offers 38 different services including 19 transpacific services, 11 services between Asia and Europe (and the Mediterranean), and 4 services between Asia and the Middle East.

THE Alliance: Hapag-Lloyd, ONE, and Yang Ming

Launched in 2017, THE Alliance combines 3.5 million TEUs. That’s approximately 25% of the global container capacity. On top of that, THE Alliance has also revealed that it will deploy a fleet of 249 ships.

They will connect 76 ports throughout Asia, North Europe, the Mediterranean, North America, Canada, Mexico, Central America, the Indian Subcontinent, and the Middle East.

In 2019, they optimized port-pair connections to accommodate customers’ needs for greater reliability and stability in service quality. In April 2020, HMM from South Korea joined THE Alliance and increased its total capacity by 519,000 TEUs. Thus, THE Alliance’s global market share went from 25% to 30%.

In September 2024, HMM, Ocean Network Express (ONE), and Yang Ming Marine Transportation announced their plans to collaborate in liner trades under the new Premier Alliance starting from February 2025.
With the Gemini Cooperation between Maersk and Hapag Lloyd in 2025, Hapag Lloyd will also no longer be part of THE Alliance.

With the Gemini Cooperation between Maersk and Hapag Lloyd in 2025, Hapag Lloyd will no longer be part of THE Alliance.