Gemini Cooperation’s 90% reliability aim equals longer transit times
Maersk and Hapag-Lloyd’s new alliance big differentiator is the claim that they will reach 90% reliability, however, this means longer transit times even when compared to late arrival by other carriers.
The Gemini Cooperation’s aim to reach 90% reliability after the alliance starts operation in February 2025 is far above the current average for container shipping lines and has provoked considerable debate from analysts about whether it is actually achievable.
For October 2024 Sea-Intelligence noted a slight improvement in global schedule reliability to 51.5% up 0.9 percentage points over the previous month. Maersk was the most reliable with a score of 57.9% while its fellow alliance partner from February Hapag-Lloyd was in the 40 – 50% range.
Gemini’s offering is reliant on a hub and spoke system between a few main regional ports with large number of feeder connections. By contrast competitors MSC, operating largely as a standalone, and the Premier and Ocean Alliance’s will offer many more direct services between port pairs.
Speaking at TOC Asia earlier this week Alan Murphy, CEO and Founder of Sea-Intelligence, noted that with the new alliance structures there would be an increase in exclusive port pairings. “Almost 60% is only offered by one alliance,so there's much less competition than we saw in the past and much more exclusive products,” he told the conference.
On the question of which alliance or line would have the best transit times Murphy said, “Because the other alliances and MSC have so many more connections its so much easier for them to connect individual ports, which also means they are generally going to be more competitive.”
By comparison he said, “Gemini because they have many fewer ports per service are simply going to be less competitive when it comes to transit time.”
Murphy noted that when this point had been raised with Maersk and Hapag-Lloyd they have countered they will offer 90% reliability so while the Gemini Cooperation might be slower in terms of published transit time their competitors will be three days late.
Sea-Intelligence undertook a comparison with all the other lines being late in line with 2024 reliability and assuming Gemini would be on time to see if Maersk and Hapag-Lloyd would become the most competitive when it comes to transit times.
"It does improve their relative position a bit, but they don't become the fastest, far from it. So that is one of the challenges they're going to face is even if they deliver a much more reliable product, they will have less connections and they will be slower," Murphy stated.
