GSF: Container carriers must address poor quality of service

Chris Welsh, Secretary General of the Global Shippers’ Forum told the ICHCA conference in Barcelona he wants an international forum to address the impact of ultra-large containerships and “super alliances” among ocean carriers.    The Global Shippers’ Forum says “the liner shipping industry must urgently address the poor quality of service afforded to shippers since the consolidation of the world’s top 20 lines into super alliances’”
   In a speech to the International Cargo Handling Co-ordination Association (ICHCA) conference in Barcelona, Chris Welsh, Secretary General of the Global Shippers’ Forum, said, “Shippers have generally supported cooperation through consortia and vessels sharing agreements as the appropriate means of rationalizing costs, provided they themselves receive a share of the benefits in terms of enhanced quality and a wider range of services made available to customers.”
   But, he argued, with the introduction of larger containerships ships and the consolidation of 16 of the 20 largest liner companies into four alliances — the 2M, Ocean 3, CKYHE and G6 — shippers continue to experience poor quality of service and disruption to their supply chains through the bunching of vessels, voided sailings and other delays.
   “The onus is on the shipping industry to demonstrate that the bigger ships and alliance business model is the best response to the economic and financial challenges faced by carriers but also adds value to customers,” said Welsh. “We believe cooperation between the main international stakeholders in a new maritime industries forum would enable the wider maritime supply chain to develop solutions to the problems presented by bigger ships and alliances in a constructive and consensual manner.
   “The received wisdom is that bigger ships and alliances are good for competition because of the benefits they are said to confer,” he added. “If the reality is that they add costs because of the negative externalities they impose on others, and if they restrict choice through reduced service competition, then other regulatory or competition policy approaches may be necessary to deal with the competition issues raised by mega vessels and alliances.”
   GSF called for the establishment of a Maritime Industries Supply Chain Forum at an international level to address the full range of challenges facing the sector.
   Welsh made his remarks a year after the International Transport Forum of the Organization for Economic Co-operation and Development (OECD) released a report titled “The Impact of Mega Ships.”
   “There has been no serious response by the shipping industry to the issues it identified – namely the wider external costs imposed by mega ships and alliances of others in the supply chain, including shippers, port and terminal operators and governments,” said GSF.