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Surprising P3-support from Chinese shipowners

The Chinese Shipowners' Association (CSA) will not have trouble supporting the P3 alliance if it complies with the rules of the market, CSA vice president Zhang Shouguo tells ShippingWatch.

Photo: APM Terminals

The world's largest container collaboration between Maersk Line, MSC, and CMA CGM - the P3 alliance - is supported by the Chinese shipowners, whom many have otherwise considered to be the biggest potential opponent of the alliance.

But in an interview with ShippingWatch, vice president of the Chinese Shipowners' Association (CSA) Zhang Shouguo states that the Chinese shipowners will support the alliance if it just complies with the common rules of the market, so that the collaboration does not hurt the competition.

"Alliances are a common practice in the container industry. If the P3 alliance complies with the rules, works to reduce the costs, and doesn't have a negative effect on the competition, we won't be against it. The problem arises if the it turns out that P3 takes over control of the industry. So we'll watch the developments very closely if the alliance becomes operational," Zhang Shouguo tells ShippingWatch.

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Threat to the Chinese

Several well-informed sources in the container industry whom ShippingWatch has spoken to have previously pointed out that the Chinese competition authorities would likely find it difficult to approve P3, as the alliance could first of all be seen as a threat to the Chinese container carriers that are not part of alliances. The Chinese competition authorities will meet with competition authorities from the United States (Federal Maritime Commission) and the EU (EU Competition Authority) in Washington, DC, one week before Christmas to discuss the perspectives of P3.

FMC chairman: P3-alliance is something very unique

Last week, senior executives of the three carriers visited Washington, DC, to meet with FMC Chairman Mario Cordero, who has previously spoken to ShippingWatch about the delicate balancing act required if and when the alliance gets a "Go!" from China and the United States. EU will also participate in the meeting, though it will not have to approve the alliance before its launch, scheduled for the 2nd quarter 2014.

Worried about abuse

Like Mario Cordero, the Chinese shipowners express "concerns" about the perspectives of the alliance, which will account for close to one third of all container traffic at sea.

"Our concerns relate to whether they will abuse their position," says Zhang Shouguo.

The EU has just received its invitation to the summit, which is how the FMC refers to the P3 meeting, and the EU has already announced that it will participate in the meeting.

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