Maersk and Hapag Update on New Cooperation After FMC Lets it Proceed

Maersk and Hapag-Lloyd provided an update on their plans for the new Gemini Cooperation after the U.S. Federal Maritime Commission said yesterday the alliance was becoming effective despite concerns over the competitive impact. Gemini is part of the broad-based reshuffling planned for 2025 across the container shipping sector as Maersk and MSC Mediterranean Shipping Company end the 2M Alliance.

Plans for the Gemini Cooperation which will make up the backbone of the companies’ East-West trades are coming together but will not be finalized till next month. They go into effect starting February 2025 and will encompass at least 27 mainlines and 30 shuttle routes. The companies presented two options one if routes through the Suez Canal can resume and which would involve 300 vessels with a combined capacity of 3.4 million TEU. If they must continue rerouting around the Cape of Good Hope the two companies plan to add 40 additional vessels to bring the total in the cooperation to 340 boxships with a total of 3.7 million TEU capacity.

“Reliability, connectivity, and sustainability are the keywords in the networks we are presenting today,” said Rolf Habben-Jansen, CEO of Hapag-Lloyd. He said they were previewing the options so that customers could begin planning “despite a highly dynamic situation.”

Both Maersk and Hapag have been diverting all their vessels away from the Red Sea since early 2024. The Houthis fired at several Maersk vessels and continue to target the company’s U.S. subsidiary Maersk Line, Ltd. Other carriers such as CMA CGM and MSC Mediterranean Shipping Company have sent some vessels through the Red Sea on an individual basis and when escorts are available mostly from EUNAVFOR’s Operation Aspides.

Maersk and Hapag made their announcement after the FMC reported that the alliance was becoming effective in the U.S. despite continued reservations. In July, the FMC had requested additional information and a 45-day review window was ending. The FMC could have sought a court injunction but decided not to seek an injunction against the Gemini Cooperation Agreement at this time.

The Chairman of the FMC, Daniel Maffei, issued a statement saying he continues to have “questions and concerns” if the agreement would result in anti-competitive consequences. Out of time, Maffei said the FMC had “no viable way to stop it from taking effect at this time.” 

He said he has directed the FMC to “engage in immediate and ongoing rigorous monitoring” to ensure the agreement does not “illegally impact U.S. importers, exporters, covered service providers and consumers.” Complaints about the business practices during the pandemic of the three alliances of the container lines were a key element in driving the U.S. Ocean Shipping Reform Act passed in 2022.

Maersk and Hapag are emphasizing that the new cooperation will provide an increased level of service for shippers. Speaking about the plans, CEO of Maersk Vincent Clec said the collaboration will “raise the bar” for benefits to customers and set a high standard for the industry. He highlighted, “Our schedule reliability target remains unchanged irrespective of which network we will phase in.” 

The companies are saying their ambition is to provide industry-leading schedule reliability above 90 percent once the cooperation is fully phased in. This summer the industry averaged just over 50 percent schedule reliability. Maersk was at the top of Sea-Intelligence’s August report with 54 percent reliability across its network while Hapag was just under 49 percent for its network.

MSC yesterday detailed its standalone plans. The line however also announced slot exchange agreements both with the Premier Alliance consisting of HMM, ONE, and Yang Ming, and Zim. Analysts will be watching to see how the reshuffling impacts the industry.