Cargo Container Shipping Lines Pool Resources for Winter Freight Coverage

Bali shipping line news After the recent news that CMA CGM and MSC will be working more closely together to maximise efficiency of freight services the two giant container shipping lines have confirmed adjustments to their schedules whilst Maersk, Hamburg Süd, CSAV and CSCL have also seen Winter season restructuring.

In an effort to balance supply and demand during the forthcoming traditional period of weaker demand, Hamburg Süd and Maersk Line on the one hand and CMA-CGM, CSAV and CSCL on the other, have reached an agreement to adjust their services between Asia, South Africa and the East Coast of South America as from this month until next May.

Each Group is currently operating two weekly services in the trade. For the period from December 2011 through May 2012, the existing ASAS/NGX Sling 2 service will be merged with the existing ASAX/SEAS Sling 2 service. The current capacity deployed by the carriers in the ASAS/NGX Sling 1 service (Maersk and Hamburg Süd ) and ASAX/SEAS Sling 1 service (CMA CGM, CSAV, CSCL) will remain unchanged and independent. This means the ASAX/SEAS 1 which currently utilises eleven 6,500 TEU vessels will now have the same number of smaller ships each between 4,200 and 4,600 capacity. Starting vessel for this New Joint Service will be MV Cap Jackson – Shanghai – December 16th and the rotation is :

Shanghai – Ningbo – Nansha – Hong Kong – Chiwan – Tanjung Pelepas – Singapore – Durban – Rio de Janeiro – Santos – Paranagua – Itajai – Santos – Port Elizabeth – Durban – Singapore – Hong Kong – Shanghai

Meanwhile the CMA CGM and MSC agreement means that from April 2012 the Asia-North Europe services (French Asia Line or FAL routes) will vary as follows.

FAL 1: operated by CMA CGM with 11 vessels of 13,800 – 14,000 TEU. Port rotation: Ningbo, Shanghai, Nansha, Hong Kong, Chiwan, Yantian, Vung Tau, Southampton, Hamburg, Bremerhaven, Rotterdam, Zeebrugge, Le Havre, Malta, Korfakkan, Port Kelang, Singapore, Yantian, Ningbo.

FAL 2: this service remains unchanged.

FAL 3: operated by CMA CGM with 11 vessels of 11,400 TEU. Port Rotation: Xingang, Pusan, Qingdao, Shanghai, Xiamen, Singapore, Port Kelang, Tangiers, Le Havre, Hamburg, Bremerhaven, Antwerp, Zeebrugge, Beirut, Jeddah, Port Kelang, Singapore, Xingang.

FAL 6: operated by MSC with 11 vessels of 14,000 TEU. Port Rotation: Dalian, Xingang, Kwang Yang, Pusan, Qingdao, Ningbo, Shanghai, Singapore, Port Kelang, Felixstowe, Zeebrugge, Antwerp, Rotterdam, Southampton, Valencia, Jebel Ali, Singapore, Hong Kong, Dalian.

FAL 7: operated by MSC with 11 vessels of 14,000 TEU. Port rotation: Ningbo, Shanghai, Xiamen, Chiwan, Yantian, Sines, Le Havre, Rotterdam, Antwerp, Felixstowe, Gioia Tauro, Singapore, Chiwan, Xiamen, Ningbo.

The existing agreement with Maersk Line on the Asia-Med trade will remain unchanged and final port coverage and transit times will be confirmed at a later stage as will any news regarding further rationalisation to the other FAL services.

Both MSC and CMA CGM have been at pains to stress that there new cooperation should not be viewed as any form of amalgamation with no staff being affected and no sharing of facilities. Such a move would undoubtedly set alarm bells ringing in the offices of anti trust authorities particularly those of the EU’s Competition Commissioner

Air Freight Cargo Conspirators Sentenced to Thirteen Months Jail

Bali Cargo news – Another pair of scalps for the United States Department of Justice (DoJ) yesterday with the news that Ulrich Ogiermann and Robert Van de Weg, two executives from Luxembourg carrier Cargolux Airlines International S.A., have received jail terms of thirteen months each for their parts in the air freight cartel activities which have scandalised the industry, after personal indictments against them to which they entered guilty pleas.

Cargolux, from the Grand Duchy and the largest European all cargo airline, has been quick to accept responsibility for its actions, pleading guilty in May 2009 and agreeing a fine of $119 million for its role in conspiring with others to suppress and eliminate competition by fixing and coordinating surcharges, including security and fuel surcharges, charged to customers located in the United States and elsewhere for air cargo shipments.

According to the indictment, Ogiermann, a ‘special advisor’ to the Company and a former president and CEO, participated in the conspiracy from at least as early as October 2001 until at least February 2006, and Van de Weg, the senior vice president of sales and marketing for Cargolux, participated in the conspiracy from at least as early December 2003 until at least February 2006. Under their plea agreements, Ogiermann and Van de Weg have also each agreed to pay a $20,000 criminal fine and to cooperate with the department’s ongoing investigation.

Including Ogiermann and Van de Weg, a total of 22 airlines and 21 executives have been charged in the Justice Department’s continuing enquiries into price fixing in the air transportation industry. To date, more than $1.8 billion in criminal fines have been imposed and four executives have been sentenced to serve prison time. The two men were charged with price fixing in violation of the Sherman Act, which carries a maximum fine of $1 million and up to 10 years in prison. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine.

Unlike many of those found guilty of the charges against them Cargolux has been open about the actions it took at the time. The company has stressed that neither man was accused of making any personal gains from their actions and, while expressing its regret for the executives personally, the company views their decision to plead guilty as a way to finally bring this matter to a controlled close both for them and the company. A search of our archives (type key words like cartel or anti trust in the News Search Box) will reveal the extent to which the freight and logistics sector walks a fine line between cooperation and collusion and this situation extends throughout the entire industry from freight forwarders to ocean container fleets.