The plan for Maersk and Hapag-Lloyd to work together under the Gemini Cooperation Agreement has run aground - at least temporarily, but has not yet been written off as a total loss.
The lines' application to the United States Federal Maritime Commission was rejected July12. The regulator may review a revised submission with more information. Other major world regulators will also have to approve the plan before it can be implemented.
The Gemini Caooperation Agreement would see the two lines join forces when the current 2M Alliance of Maersk and MSC expires, and THE Alliance (Hapag-Lloyd, HMM, Yang Ming and ONE) expires, both in February 2025. However the Agreement was to take effect this week in order to allow for the necessary preliminary work.
The plan will see a major shakeup as the two former competitors withdraw from competing services and realign. Yesterday (July 14) the NYK Demeter sailed from Halifax with the usual large number of Hapag-Loyd, UASC and CSAV boxes. The ship operates for THE Alliance, as NYK Line is a partner in ONE (Ocean Network Express). The potential loss of Hapag-Lloyd related cargo may well see the collapse of THE Alliance as the other lines my find it difficult to maintain service.
With the ports of Halifax (and partner CN Rail) and Saint John (with the newly merged CPKC) vying for the realigned services, the fallout for Halifax may be quite significant. However to the credit of the FEC, the lines must show some benefit to customers, not just an improvement in their own operating ratios before regulatory approval is granted.
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