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Maersk, Hamburg Süd: the two-headed giant

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Maersk, Hamburg Süd: the two-headed giant

Synergies create the largest global network in the industry
Edition of March 19, 2018

Since the final approval by free competition authorities in December 2017, Maersk Line and Hamburg Süd have continued to operate as separate brands, but with a strong integrated network that benefits their customers, thus creating the “world’s largest global shipping network.”

In an exclusive interview with MundoMaritimo, Francisco Ulloa, West Coast Director for Maersk Line, the executive detailed the synergies in services, trade routes and other benefits for both liners’ clients. “On a global scale, we have a market share close to 19%, with operations in the most important ports and with trade routes to the main markets, promoting international commerce around the globe. Without a doubt, the main focus of this operation is to improve the value proposal for both companies’ clients,” says Ulloa.

Regarding the estimated cost of the integrated operation and profit projections for 1H18, West Coast Director for Maersk Line says that “A.P. Moller – Maersk expects underlying profit for 2018 to be higher than 2017 (US$ 356m) and EBITDA in the US$ 4 – 5 billion range.”

New services and technologies

“Maersk Line has just launched the new AC5 service: Asia – Latin America / WCSA, expected to be operational starting April 2018. This service will offer Maersk Line clients new trade routes for Colombia, The Caribbean and Pecem, Brazil, reducing transit times and larger port coverage,” adds the executive.

“The service will also offer direct access to the Chilean ports Angamos, Antofagasta, Iquique, San Antonio, Valparaiso and San Vicente. Maersk Line will be able to offer dedicated and direct products for the Peruvian and Chilean markets through the AC1 service, Mexico and Central America markets through the AC2 service and Colombia, Panama and The Caribbean markets with the AC5, in addition to a service covering the west coast of Latin America (AC3), providing an important network for shippers.”

High Tech

Supply chains are complex and it is estimated that the maximum cost of commercial documentation required for administration and processing transported products is about one fifth of actual physical transportation costs. According to the World Economic Forum, by reducing barriers within the international supply chain, world commerce could increase by nearly 15 per cent, thus boosting economies and creating new jobs. Therefore, technologies such as blockchain are necessary for digitalizing processes and make transactions simpler and more transparent.

As far as technology goes, Maersk Container Industry has become an important trendsetter in the refrigerated containers on a global scale. “In the near future our entire reefer container fleet will have the same quality and technological development standard that our clients are used to. The containers will all have remote container management system (RCM) that provides real-time location, temperature and gas levels,” Ulloa adds.

Benefits for the Latam region

With the combined operation between the Danish and the German liners, one in three containers will be moved by Maersk Line in Latin America, “allowing us to deliver a better service in the region, with an unparallel network of services, better routes and the latest reefer technology.” Also, currently, all WCSA/ECSA terminals have the capacity to serve all and any ships operating under the integrated model.

By MundoMaritimo


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