The JOURNAL of COMMERCE ONLINE
LOS ANGELES -- The Transpacific Stabilization Agreement announced Monday that CMA CGM is resigning from the carrier discussion group effective Jan. 1, 2006.
The move drops membership in the TSA, which represents carriers in the eastbound Pacific, to 11 lines.
CMA CGM confirmed that it is leaving the TSA. While CMA CGM offered no immediate explanation, the carrier is in the midst of a major expansion program in which it will take delivery of more than 40 new vessels over the next four years.
The deliveries will begin in 2006 with four vessels of 9,100-TEU capacity and 10 ships of 8,200-TEU capacity. CMA CGM will add another eight post-Panamax vessels of 5,600-TEU capacity to its global fleet in 2007.
When carriers significantly expand their capacity, their immediate need is to fill the new ships, and membership in carrier discussion arrangements like the TSA can restrict their pricing flexibility. Maersk Sealand resigned from the TSA last year and has since agreed to purchase P&O Nedlloyd.
The loss of Maersk Sealand and now CMA CGM will weaken the influence of the TSA in the largest U.S. trade lane. The TSA recommends voluntary price increases and surcharges on behalf of its members. Although the TSA has no enforcement powers, its guidelines are announced after consensus is reached among its members and they represent the overall market analysis of the trade.
The TSA in November announced its voluntary rate hikes for the 2006-07 contracting season in the eastbound Pacific. The increases included $150 per 40-foot container for port-to-port shipments from Asia to the West Coast, $350 for intermodal inland rail shipments as well as mini-landbridge shipments from West Coast ports to the East Coast and $400 for all-water shipment from Asia to the East Coast.