The sharing of yard equipment is another challenge and is dependent on proximity and whether the terminals have a common mode of operation, Davidson said.
In regard to the “key ingredients” for successful terminal alliances, Davidson said a big plus is if the terminals are physically adjacent, with contiguous berthing lines.
Another key to success is if the terminals are similar in nature (size, draft, crane capability and yard equipment), he said, adding that it’s also better if the number of operators in the potential alliance is low.
“In general, the more parties that are involved, the harder it will be to find a workable terminal alliance,” Davidson said. “In fact, the ideal number really is just two operators. More parties mean more interests, greater complexity and additional challenges in finding a workable solution.”
It also helps if average terminal utilization is high and there’s a regulatory environment that is supportive of terminal alliances, he explained.
Davidson said that to date, only three ports have announced plans to form terminal alliances: Miami, Colombo and Hong Kong.
In 2016, the two operators of specialized container terminals at Port Miami received approval from the Federal Maritime Commission for an alliance. “The Miami alliance is particularly logical as the two terminals are located adjacent to each other in the port,” Davidson said. “To date, the two operators have yet to fully implement the agreement and discussions remain underway.”
The Sri Lanka Ports Authority signed a memorandum of understanding in 2018 covering three terminals at the Port of Colombo, in which the Sri Lanka Ports Authority is the owner and operator of one and a minority shareholder of the other two.
“The intention is for the terminals to work together to coordinate operations and reduce waiting times for container vessels by allocating them to whichever terminal is available,” Davidson said. “Anecdotal evidence suggests that the alliance remains under development, although some progress has been made. For example, the three terminals are working closely together now to reduce inter-terminal truck transfers of containers.”
However, the Hong Kong Shippers’ Council lashed out against its formation. “The four terminal operators account for over 95 percent of container terminal business in Hong Kong,” the council said in a Jan. 9 press release. “The council is extremely worried about overwhelming market position of the alliance.”
On Jan. 10, the Hong Kong Competition Commission issued a statement saying it was conducting an investigation into the planned alliance.
The HKSPA issued a statement March 29 saying it had finalized its berth and yard planning strategies and its joint operating agreement was expected to be “progressively implemented” from April 1.
“The 23 berths of the members of HKSPA will be divided into three terminal zones to provide greater efficiency to shipping alliances and individual carriers. Under the new arrangement, a number of efficiency enhancements will be introduced,” HKSPA said. “Among them, inter-terminal trucking will be significantly reduced, and in many cases eliminated, which will be an important step in bringing cost savings to customers.” However, a Hong Kong Competition Commission spokesperson said in an emailed statement this week that its investigation into the HKSPA is still ongoing.