News / Transpac shippers struggle to trust carriers now 'learning from their mistakes'

Ocean carriers attending the S&P Global TPM conference in Long Beach this week are owning up to mistakes over the past two years and are jockeying to rekindle relationships with shippers.

“Being back in front of the customer is the number-one priority for us right now,” said Peter Levesque, new president of CMA CGM in North America.

In conversation with Mark Szakonyi of Journal of Commerce and S&P Global’s executive editor, Mr Levesque told the audience “a lot of things went wrong” with carrier-shipper relationships, but he suggested it was now time to “draw a line and learn from those mistakes”.

He added: “There is a reason why your windshield is bigger than your rear-view mirror – you have to look forward.”

On the outlook for the transpacific market, Mr Levesque said CMA CGM was expecting a slow first half, but was “betting on a very strong second half” when bloated inventory stocks would need replenishing.

He poured cold water on the rumours of a break-up of the Ocean Alliance vessel-sharing agreement, of which it is the lead line and a partner of Cosco (OOCL) and Evergreen. In fact, he suggested the alliance’s pooling relationship would be stronger in the fallout of the dissolving of the 2M.

However, Vespucci Maritime CEO Lars Jensen told a packed auditorium yesterday morning he believed the 2M divorce would prompt another round of ‘alliance musical chairs’ that could lead to the break-up of the Ocean Alliance.

He also speculated on a merger of THE Alliance members Hapag Lloyd and Japanese carrier ONE, as carriers attempt to scale up to compete on a one-to-one basis with MSC and Maersk.

Meanwhile, on the final day of TPM, the popular shipper case studies sessions reflected on challenges faced by US importers and exporters at the height of the supply chain capacity crunch.

On a positive note, Larry Gorsich, global transport director at Columbia-headquartered fishing products manufacturer Pure Fishing, spoke of its relationship with ONE, which he said had “stepped up when nobody else was interested” to agree a contract deal for 4,000 teu imported annually from Asia.

Mr Gorsich said communication had been key to the success of the relationship, including a weekly Friday call between himself and ONE’s area sales manager, William Knight. He said: “We discuss forecast accuracy and performance and still have the call even if there’s not much to talk about,” adding that they were “not afraid to air dirty laundry” on the call.

Mr Knight agreed: “If you don’t acknowledge that something is broken, then you are not going to make any headway.”

In contrast, executives at the huge Wichita, Kansas-headquartered multinational conglomerate Koch Industries said they had failed to gain a reliable partnership with any container line for its annual 300,000 teu of exports. Instead, it took the unusual step of appointing Olso-based specialist G2 Ocean to cover its export shipping requirements, using converted bulk vessels.

David Null, SVP for customer experience and supply chain at Koch Industries spoke of the “very open relationship” with G2 Ocean. He said: “We don’t necessarily agree all the time, but it’s all about trust with a preferred partner that makes the relationship work.”