CKYH alliance switches capacity from Atlantic to Pacific
In a context of high vessel charter rates and poor profitability for carriers in the transatlantic trade, the CKYH alliance carriers COSCO Container Lines, “K” Line, Yang Ming and Hanjin Shipping have decided to cut capacity in the Atlantic and switch vessels to the transpacific.
Four ships of about 3,400-TEU capacities used in the alliance’s “TA1” joint service between the U.S. East Coast and North Europe will be transferred to the Asia/U.S. East Coast trade, a Yang Ming executive told American Shipper. They will be replaced in the Atlantic trade by four vessels of only 2,800-TEU capacities, representing a capacity cut of about 20 percent.
In the U.S. East Coast/Mediterranean trade, the Asian carriers’ alliance will also cut in half the capacity of their ships in the “TA3” service from 2,800 TEUs to about 1,400 TEUs.
Yang Ming described the transatlantic trade as “comparatively unprofitable,” and said larger ships could get a better return in the Pacific trade.
However, the recent addition of a westbound transatlantic North Europe/U.S. East Coast service by China Shipping Container Lines, Norasia and Zim may offset the capacity reduction of the CKYH alliance.