2M Alliance Coming to an End as Maersk and MSC Finally Split
Like a bad hairstyle fad, the 2M Alliance is coming to an end. But that end won’t be abrupt. The process is not as simple as combing hair along a part, sending this section of hair that way and that section of hair this way. The 2M Alliance has a complex network of container ship and service sharing that Maersk and MSC have given themselves two years to untangle.
That ratted mess of a metaphor may not have been worth it, so here’s the straightforward way Greg Knowler reported the news in a Journal of Commerce article:
Mediterranean Shipping Co. and Maersk will terminate their 10-year 2M Alliance in January 2025 as the carriers “pursue individual strategies” and focus on integrated networks, they announced Wednesday.
MSC, Maersk Split a Long Time Coming
Regular readers of Universal Cargo’s blog won’t be surprised to hear the news that Maersk and MSC are parting ways. A matter of months ago I asked even in the headline of a post if MSC was positioning itself to ditch Maersk and the 2M Alliance.
At that time, Lars Jensen, CEO and Partner at Vespucci Maritime, was pointing out all the ship buying and ordering MSC had been doing as evidence that the carrier could be preparing to leave its alliance with Maersk to go on its own. I’d already written about MSC ordering ships and buying “anything that floats” even after it was already on its way to overtake Maersk as the world’s largest carrier by capacity. Jensen pointed out that between the ships MSC had acquired and the ones it had on order, its fleet was on its way to be larger than the combined fleets of Maersk and MSC when they formed 2M.
Jensen thought that was enough evidence to suggest a 2M split was on the way, but there was already evidence that Maersk and MSC were headed in that direction. In November of 2019, I posted in Universal Cargo’s blog about things getting bitter between Maersk and MSC in their 2M Alliance.
MSC had poached an executive from Maersk. It was reported that the executive poaching had left a “bitter taste” in the 2M working relationship between the shipping lines. But I believed there already was bitterness growing from MSC’s moves to exceed Maersk’s size. The previous month, I’d written about MSC being on its way to usurp Maersk’s throne, in which I shared a Loadstar reported quote from a senior Maersk manager that sounded quite bitter indeed. The Maersk manager had said, “MSC are getting too big for their boots and we have a fight on our hands to stop them.”
Bitterness might not even have been a strong enough word. That quote sounded like full-on enmity between the shipping lines. But even this wasn’t the beginnings of troubles between the shipping lines.
In fact, all the way back in 2016 I headlined a Universal Cargo blog post with, “Is There Trouble in 2M Alliance?“
2016 was the early days of the 2M Alliance. While it had gained maritime authority approval in 2014, 2M had only begun operating in 2015. The honeymoon after the shipping lines’ alliance certainly didn’t last long. The first public trouble in the marriage was around disunity over what was supposed to be a joint service turning into an exclusive service from Maersk. This happened right after Maersk had announced a bold new business strategy.
It was unknown at the time what MSC thought of Maersk’s aggressive business strategy, but the two went in different directions strategy-wise since. That they’ve now announced the 2M split is to “pursue individual strategies” certainly rings true as part of why they’ve decided to part ways. But as the history of the 2M Alliance seems as messy as my kids’ hair when they get out of bed in the morning, it definitely seems to be only part of the story.
I’ve long speculated we’d see an end to this alliance in Universal Cargo’s blog. Finally, it’s happening.
Next Week – What This Means for Shippers
In Tuesday’s post, I’ll get into the strategies Maersk and MSC are pursuing and what all this likely means for shippers.