Dive Brief:
- Ocean Network Express (ONE) began its container shipping operations on April 1, 2018.
- The new container line boasts a capacity of 1,400,000 TEUs, operating on 85 service loops reaching more than 200 of the world's ports.
- The new carrier — created from a merger of K Line, MOL and NYK Line's container and terminal services (outside of Japan) — is now the sixth largest ocean liner in the world, by capacity.
Dive Insight:
The launch of ONE is perhaps the most visible consequence to date of the ocean industry's consolidation.
As of Sunday, a wave of magenta ships and containers began sailing the seven seas for the first time, replacing over time the red, dark blue and gray containers of its Japanese predecessors. ONE's services will reach roughly 15 ports in North America, from Halifax to Honolulu, and many more worldwide. Its commitment, the company says, is to "transform the global container business with new and innovative services."
The launch is, without a doubt, transformational. It will mark the first time, ever, three major container liners have merged at once. It's a further step toward the industry's consolidation, leaving just six ocean carriers controlling most of the world's container capacity.
Top 6 ocean carriers by capacity, if all proposed deals are approved
| Rank | Company | Capacity (TEUs) | Market Share |
|---|---|---|---|
| 1 | A.P. Moller-Maersk | 4,147,949 | 18.9% |
| 2 | Mediterranean Shipping Co. | 3,220,548 | 14.7% |
| 3 | COSCO Shipping (+ OOCL) | 2,586,168 | 11.8% |
| 4 | CMA CGM | 2,519,633 | 11.5% |
| 5 | Hapag-Lloyd | 1,578,966 | 7.2% |
| 6 | Ocean Network Express | 1,498,992 | 6.8% |
| Total | 15,552,256 | 70.9% |
SOURCE: Alphaliner TOP 100, retrieved 4/2/2018
Add in terminal operations into the merger mix, however, and it becomes clear April 1 may prove pivotal not just to ONE's customers, but to ocean carriers and freight forwarders around the world.
Even within a single company, or port, terminal operating systems are not always well-coordinated. Bringing in three company's systems online to start managing bookings, cargo transshipments and vessel arrival and departures is no easy feat. While ONE took its time over its past year to set up its systems, the booking period from February to April was just a beta test for what was to come.
Now, the carrier will be under the spotlight to see if it can truly deliver the service it promises, and if not, whether its mishaps will cause disruptions across the greater supply chain.
