P3 to help carriers manage yield, 3PL executive says
Ocean carriers in the new P3 Network will have increased flexibility to optimize the types of vessels deployed on particular service strings, a logistics industry executive said Monday.
The vessel-sharing alliance between the three largest container lines -- Maersk, Mediterranean Shipping Co. and CMA CGM -- has created a lot of angst among shippers about concentration of market power that could lead to rate increases or service reductions.
The U.S. Federal Maritime Commission voted last week not to block the operational alliance.
The carriers "will actually switch out vessels very rapidly" from big to small and vice versa to take advantage of market conditions, Scott Kelly, vice president of global ocean services for Expeditors International, predicted during a keynote address at the American Association of Port Authorities' spring conference in Washington.
Seattle-based Expeditors is a large purchaser of ocean transportation.
Large vessels will be moved to trade lanes where there is opportunity to grow business and smaller vessels put on less profitable routes, he said.
"I think that's going to put pressure on ports to have the right infrastructure," such as deep channels and cranes, to accommodate a variety of vessel sizes, Kelly said.
The P3 members plan to begin joint operations in the second quarter.
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