Analysis: Carriers calling the eastern seaboard and which ports catch them

By Francis Phillips and Stephen Wynn

   ComPair Data’s BlueWater Reporting database has been developed over the past 12 years to identify and continuously track all published regular liner schedule services operating between ports in numerous regions and sub-regions all over the world. The carriers operating ships or chartering slots on each service are identified, along with details of the ships themselves and their capacity, also the frequency of sailings. A full port sequence for each “loop”  of ships is recorded, along with a numbered arrival and departure day for each port in turn. 
   Using this data it has long been possible to monitor the level of ship capacity in key trade lanes and examine individual port-port transit times. However, now that the number of regions between which services are tracked has grown to 15, a very high proportion of the world’s significant carriers now show up on BlueWater Reporting’s radar as they cross from ports in one region to ports in another. In Asia there are four regions: Japan/Korea/East Russia; China/Taiwan/Hong Kong; Southeast Asia; and Indian Subcontinent/Mid East. Europe has been divided into North Europe and the Mediterranean, and North America into U.S.A./Canada and Mexico.
   Besides tracking services between each of these eight regions, BlueWater Reporting tracks services linking them with other parts of the world: with Africa, Oceania, and Latin America. Latin America has been further sub-divided into four sub-regions: Central America; Caribbean/North Coast South America; East Coast South America and West Coast South America.
   The result of developing this much finer “mesh” of services in the database means new questions can be asked with confidence; ones like “which carriers are calling most regularly at specific ports?” Or to turn the question round, “which ports in a region are catching the best shares of the available carriers’ port calls?”

Three classes of ocean carriers.   Like north America’s railroads, there seem to be three classes of ocean carrier in the world. Class 1 carriers could be defined as having near global coverage, with at least one service calling in each region’s major range of ports. At the other end of the spectrum Class 3 carriers tend to be local in their sphere of operation. Typically these are small intra-Asian, Intra-Americas or intra-European operators – still clinging to local market niches or developing new roles as common-user feeder operators for the Class 1 carriers. 
   Class 2 carriers operate in the space between Class 1 and Class 3. They are sub-global but may have long-established services in longer trades. Included in this group would be multi-purpose carriers, often one-way specialists, or car carriers looking for one-way rolling cargo backloads. Class 2 and Class 3 carriers seem to meet  fierce opposition from the Class 1 lines whenever they try to expand by adding new deepsea services, but Class 1 carriers frequently hold out helping hands to one another, permitting new trade entry denied to lines in classes 2 and 3.
   An initial study of 20 large ports or port pairs in Asia, Europe, and North America and hub ports in between, showed that the list of Class 1 carriers almost exactly matched the usual ‘Top 20’ in the ship capacity league. As in the capacity league, this Class 1 definition excludes brand name subsidiaries wherever they share their parent lines’ services. At the border line between Class 1 and Class 2 was PIL, with wide global coverage except for east coast North America and Panama. Chile’s CCNI is clearly in Class 1, even though down around 30th in the capacity league.

Focus on the eastern seaboard.   The North American eastern seaboard range of ports was then examined in more detail. Twenty significant ports were considered, extending from Montreal and Halifax in Canada to Altamira and Veracruz in Mexico. They fall roughly into five port sub-ranges: eastern Canada; north Atlantic; south Atlantic; south Florida and U.S./Mexico Gulf. In total, 62 carriers, collectively provide 178 services touching these ports.
   It was anticipated that by considering each carrier’s number of port calls, port by port, and in total, light would be shed on the scene in two quite different ways. One way was how the carriers rank by total number of port calls made and which ports they individually use. The other way would be to rank each port by the number of carriers’ port calls it attracted, revealing the specific carriers involved. The results are summarized in two tables. Table 1 shows carriers ranked by their total port calls and Table 2 ranks the ports by total port calls.
   Color-coding has been used in both tables to identify Class 1, 2, and 3 lines (blue, red and yellow respectively). Any port call by any carrier is included. No attempt has been made to differentiate between port calls made by services with just one carrier and other services with multiple partners or slot charterers. Each carrier on a service is credited with one port call per port called. In other words  it is not the ship calling at a port but the carrier(s) on it which is being measured.

Hapag-Lloyd tops the carrier list.   It may surprise some to see that Germany’s Hapag-Lloyd tops the list of carriers in terms of port calls (Table 1). It makes 67 port calls with 22 services, calling at a total of 13 ports. This carrier has always been exceptionally strong in the transatlantic trade, launching the world’s first purpose-built container service there as early as 1968. It further boosted its’ profile in Canadian markets with the acquisition of CP Ships in 2005. It has six port calls in Montreal and Halifax on six different services, and In the Gulf no other carrier exceeds the five services Hapag-Lloyd has radiating from Houston. Throughout the entire port range it benefits from having a strong Asian-based Grand Alliance partner in NYK. 
   Next in line is CMA CGM with 62 port calls and 16 services, operating out of 16 eastern seaboard ports. Maersk Line and MSC, with sixteen services each, achieve 56 and 52 port calls respectively, calling at 16 and 15 ports apiece. The top Asian carriers are Hapag-Lloyd’s Grand Alliance partners OOCL (with 43 port calls), NYK (38), Hyundai (37), APL (36) and Hanjin (35). New World Alliance partners Hyundai and APL call at 9 ports each, while their partner MOL limits itself to 26 port calls and at position 14 is the first carrier in the list calling as few as six ports. 
   CSAV of Chile comes in surprisingly strongly in 10th position, with 34 port calls spread over 13 ports. On close inspection all its services are now provided jointly with major European lines – CMA CGM and MSC, or German partners Hapag-Lloyd and Hamburg Sud (see commentary “Germany’s big 2” published April 6). Hamburg Sud itself, despite traditionally leaving key east-west trades exclusively to Hapag-Lloyd, has been progressively helped by other European lines to 11th position on the eastern seaboard, now achieving 29 port calls at 12 different ports.
   The first Class 2 carrier in the list, at position 12, is the Grimaldi group which owns ACL. Somewhat surprisingly it makes 26 port calls at 12 ports. Grimaldi only operates two east coast services: ACL’s ConRo transatlantic loop and one in its own name to West Africa. However, Grimaldi exchanges space with Hapag-Lloyd on ACL’s one transatlantic loop in return for space on four Hapag-Lloyd ones, thereby magnificently expanding its port coverage for containers in both north Europe and North America.
   It is not until Seaboard Marine comes in at 17th position with 21 port calls that the first Class 3 carrier enters the list. Seaboard has 17 services and operates from just six ports. It has 13 services coming out of Miami alone. 
   The number of Class 1 carriers in the eastern seaboard list is 20, (absent PIL and including Chile’s CCNI). Purely intra-Americas Class 3 carriers total 15, making the Class 2 category of carriers numerically the largest, totaling 27. From Table 1 it emerges that the top 12 carriers, or 20 percent of the total 62, generate 60 percent of the total port calls.

Just three dominant ports.   When viewing the data from the ports’ point of view (Table 2) it stands out a mile that just three ports are capturing more port calls and services than any of the other 17.  These are New York (with 130 regular port calls), Savannah (125) and Norfolk (113). Next up is Charleston, a rival to Savannah in the south Atlantic range, with 82 port calls on a regular basis. After this comes Houston, the westernmost U.S. port on the Gulf, with 62 port calls. The interesting thing about Houston is the number of lines which call there, 30, up alongside New York and Savannah with 31 and 29.
   Also Interesting is how the south Florida port cluster of Palm Beach, Port Everglades and Miami notch up a total of 94 port calls. This probably illustrates the combined influence of more numerous Class 3 carriers as clients and Florida’s comparatively benign port labor cost environment. The Class 3 carriers swelling this total of port calls include Tropical Shipping based in Palm Beach (8), Crowley Maritime in Port Everglades (7) and Seaboard Marine in Miami (13).
   Jacksonville in north Florida has 12 of its total 47 calls contributed by Class 3 local Caribbean operators and another four by Class 2 car carrier Hoegh Lines. Apart from one call by Horizon Lines in New York, the top three ports have no calls by any Class 3 carriers. The two main Canadian container ports have no Class 3 carriers at all, compared with Houston which has seven.

No mainland transshipment hubs on the eastern seaboard.   The U.S regulatory and union port environment ensures that despite the size of the North American economy, no major entrepot transshipment hub ports have emerged on the eastern seaboard. This is unlike other parts of the maritime world and is confirmed by the complete absence of any Class 3 lines deliberately feeding into larger ports so they can act as transshipment points, both coastwise and to other parts of the world. The nearest this is happening is in south Florida, with cargo which originates from, or is destined to points outside the U.S.A. There is even one small line feeding into Port Everglades from Altamira and Veracruz in Mexico.
   The main inhibiting factor is the restrictive Jones Act which splits the Class 3 carriers into two camps – one providing  for  the high cost Jones Act trades connecting the mainland with offshore U.S. destinations  (like Puerto Rico  and Hawaii), and the other camp more cost-effectively connecting the U.S.A. (locally)  with everywhere else. Generally  speaking all the Class 1 and 2 carriers, bar Matson Navigation, are non-U.S.A.-owned and probably see benefits in keeping the Jones Act in place, along with large traditional pro-Jones Act lobbies such as railroads, barge carriers and truckers. 
   The result has been for carriers like Maersk Line, MSC and CMA CGM, who are moving towards total global hub and spoke route networks, to treat all the eastern seaboard North America ports as feeder or “spoke” destinations to/from mega-regional hubs elsewhere.  Heading south Maersk’s services all seem to be converging on huge interchange hubs in Manzanillo (Panama) and Balboa. In the Mediterranean it is Algeciras or Tangiers. North Europe has several major hubs, each attracting all classes of carrier.
   There are two very interesting pendulum services which for many years have served to link north Europe with the eastern seaboard before continuing on to a major hub in Manzanillo (Panama). One is the Grand Alliance’s PAX loop, and the other the New World’s APX. (These should probably rate as double-call services in a study such as this, loading and discharging to/from both Manzanillo and Europe.) What this arrangement permits is different ratios of cargo between the transatlantic and Europe-Caribbean legs in opposite directions, a key feature of hub and spoke operations. Recently the New World Alliance launched a second Europe-ECNA-Manzanillo pendulum service (AEE). When Maersk Line stopped its direct service between the eastern seaboard and west coast South America, it revealed it took eastern seaboard slots on both the APX and AEE loops, at least as far Panama, for alternative transshipment to west coast South America there.
   MSC has skillfully brought its hub close offshore, to Freeport (Bahamas), a development almost certainly conceived many years ago. No less than 13 eastern seaboard ports, between Montreal and Veracruz, are connected to Freeport, either by feeders or services continuing elsewhere. Cargo to/from all 13 ports connects with services to/from all parts of the world. Some destinations, such as west coast South America, can now only be reached from the eastern seaboard ports via Freeport.
   A “spoke” service can either end at a hub, or continue past it to a destination on the other side. The evidence of a hub and spoke strategy is that services tend never to go past a hub without calling there, unless forming a more direct spoke to a hub which is further away. There will be fewer and fewer loops which do not call at a hub somewhere along their way. Maersk and CMA CGM share a joint loop of 8,500-TEU ships calling at New York, Norfolk and Savannah, forming a non-stop spoke to and from Maersk’s giant Southeast Asia hub of Tanjung Pelepas. It is Tanjung Pelepas which is the hub, not the other way around. Analysis of service routings goes beyond the scope of this study, but it is hard to avoid noticing that there is now a very distinct global pattern of giant hubs emerging, which does not include a single port in the eastern U.S.A.