Maersk focuses on Asia success

Maersk focuses on Asia success

Kolding

   While the A.P. Moller – Maersk Group was detailing a historic operating loss, headlined by a $2.1 billion loss for its container division, a noticeable development was emerging.
   Maersk is increasingly focusing on its business in and out of Asia — and not just exports to the traditional consumption regions in Europe and North America.
   Maersk is quite aware of the potential of Asia to drag the container industry out of the doldrums of 2009. Maersk Line Chief Executive Officer Eivind Kolding, in an interview with American Shipper last week, pointed to more lasting strength in Asia than in the developed regions.
   'A full recovery in Asia import volumes is rebalancing trade,' he said. 'The backhaul trades to Asia and intra-Asia were strong in 2009,' a point Maersk Group CEO Nils Andersen made as far back as the third quarter of 2009 and reiterated again last week.
   Europe-to-Asia volume grew 25 percent for Maersk and intra-Asia volumes grew 35 percent during 2009. Though rates in both trades compare unfavorably to head-haul east/west trades, they are a source of growth.

Andersen

   Intra-Asia 'is very important as we see a lot of benefits,' Kolding told American Shipper. 'Clients need intra-Asia services and MCC Transport (Maersk's wholly owned intra-Asia subsidiary) serves a big role in feedering for us. The dynamics of intra-Asia are different. You have to be more agile and there are lower margins. But we don't see it as a competitor to other trades. It's complementary.'
   Kolding also spoke about Maersk's rebranding efforts in recent years for several of its non-liner businesses. Last year, Maersk merged its Damco forwarding business and Maersk Logistics subsidiary into one unit under the Damco brand. Also last year, Maersk concentrated the marketing of its intra-Asia services under the MCC name. And, of course, Maersk's terminal operating division has operated under the APM Terminals moniker for years.
   'It's not a strategy but it seems to have made sense in each instance,' Kolding said.
   Kolding said in the cases of APM Terminals and Damco, the company is often seeking the business of its liner carrier competitors, and so it makes sense not to promote the Maersk name.
   Kolding spoke to American Shipper about a wide range of topics, including consolidation in the industry: 'If two mid-size players merge together it wouldn't affect things. It's natural in so many other industries for the top two or three companies to control 75 to 80 percent to have stability and profitability.'
   He also commented on the two-year-old collaboration between Maersk, Mediterranean Shipping Co. and CMA CGM on the transpacific: 'It's actually worked well. We've seen the benefits of higher average utilization. The transpacific, operationally, is not the most difficult to service, so we can keep high quality through the (vessel sharing agreement). It's more tactical than strategic.'
   Maersk made another major move in the transpacific in late 2009 when it decided to rejoin the Transpacific Stabilization Agreement after a five-year absence. Kolding said the environment, both inside and outside the carrier community, had changed in the intervening years.
   'If we can get benefits and stability out of (being a TSA member), we can certainly continue,' he said. 'That was not the case when we left. The circumstances have led carriers to be more disciplined and like-minded.' ' Eric Johnson