📊 Maersk - Hapag-Lloyd alliance

Irbis Index December 2023

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News

Maersk and Hapag-Lloyd are entering into an operational cooperation The shipping industry is experiencing a significant realignment as Maersk and Hapag-Lloyd, two of the world's largest container shipping lines, have announced a new partnership known as the "Gemini Cooperation."

• This collaboration is set to begin in February 2025, immediately following the conclusion of the current 2M Alliance between Maersk and MSC Mediterranean Shipping Company.

• The Gemini Cooperation will merge the fleets of Maersk and Hapag-Lloyd, creating a pool of approximately 290 vessels with a combined capacity of 3.4 million TEUs.

• Maersk will contribute 60% of these vessels, while Hapag-Lloyd will provide the remaining 40%. The partnership aims to achieve above 90% schedule reliability, which is a significant target for the industry.

• This new alliance will result in Hapag-Lloyd leaving THE Alliance, which it has been a part of for eight years. THE Alliance currently includes NYK, Yang Ming, MOL, K-Line, and HMM.

• The Gemini Cooperation will implement a 'hub and spoke' network structure, which aims to limit port calls on deep-sea loops to improve efficiency. The network will cover seven trade lanes, including Asia – U.S. West Coast, Asia – U.S. East Coast, and Transatlantic routes, offering 58 new services and around 6,000 port-to-port combinations.

• The formation of this partnership is a major move in the ocean shipping alliances and reflects the industry's ongoing efforts to adapt to changing market conditions and improve operational efficiency. (link)

Ontario Teachers' Pension Plan and Boreal IM acquire five logistics assets The Ontario Teachers' Pension Plan and Boreal IM have announced their latest acquisition in the French logistics market, a portfolio of five fully-let logistics assets spanning 165,000 square meters.

• This marks the joint venture's second investment in France, following the acquisition of a standing asset and development plot in Paris in 2023.

• The newly acquired assets are located in Lyon, Nantes, and Lille, cities that are part of the French logistics "Backbone" and "Atlantic Corridor" where there is a structural undersupply of logistics assets and limited potential for additional development.

• This acquisition aligns with the joint venture's strategy of targeting assets in supply-constrained locations with strong occupier demand and potential for improved rental levels in the mid-term.

• Jenny Hammarlund, Senior Managing Director, Real Estate at Ontario Teachers’ Pension Plan, said: “This portfolio is a strategic acquisition for the JV, significantly growing our AUM in France and further diversifying our geographic presence. We now have the opportunity to work with a strong roster of tenants to implement ESG initiatives as we continue to build our best-in-class portfolio and create value through active asset management.”(link)

Hydrogen company Plug Power closes in on $1.6B loan Plug Power Inc., a company specializing in hydrogen fuel cell technology, is nearing the finalization of a $1.6 billion loan from the U.S. Department of Energy (DOE).

• The loan is expected to be finalized by the third quarter of 2024.

• The funding will support the construction of up to six hydrogen production plants, significantly advancing green hydrogen deployment in the United States.

• The loan is expected to catalyze ongoing projects and is projected to generate over 200 tons of hydrogen daily.

• The announcement of the loan has led to a surge in Plug Power's shares, marking the most significant intraday gain since January 2021.

• The company has also announced that its electolyzer production plant in Georgia is now operational, and another one in Tennessee is expected to open soon.

• The loan from the DOE is a key component of Plug Power's growth plans. The company is currently building hydrogen plants in Texas, New York, and Louisiana, with four more sites under development.

• The loan is expected to be finalized by the end of March 2024, and construction of the new plants is set to start in the second half of 2024. (link)

Logistics-Tech Startups Face Uncertain Future as Freight Slump Continues The logistics technology sector is currently facing a challenging period due to a prolonged slump in freight that has extended into 2024.

• The global freight slump has been deepening since the start of 2023, with manufacturers and distributors struggling to reduce excess inventories. This has led to a decrease in global freight movements, with significant drops in seaborne container shipments and air cargo.

• The freight recession has been particularly hard on logistics startups. For instance, the trucking startup Convoy shut down suddenly, shocking industry insiders. The freight recession has also led to a decrease in the number of carriers in the trucking market.

• Despite these challenges, some believe that the global shipping recession could end soon due to rising freight rates caused by issues in the Red Sea.

• However, others caution that the freight market contraction is expected to continue into early 2024.

• In response to these market conditions, logistics startups are seeking ways to adapt and survive. Some are focusing on enhancing their technology stack, while others are exploring mergers and acquisitions.

• However, the overall outlook for logistics startups remains uncertain due to the ongoing freight slump and the potential for a full-blown recession in major economies. (link)

Trucking tonnage finishes 2023 with worst results since 2020

• The trucking industry experienced its worst year since 2020, according to the American Trucking Association (ATA).

• Despite a slight increase in trucking tonnage in December 2023, the overall year saw a downturn.

• The Index rose by 2.1% in December, following a 1.4% drop in November.

• However, compared to December 2022, the index fell by 0.5%, marking the tenth consecutive year-over-year decrease.

• For the entire year, tonnage contracted by 1.7% from 2022 levels, making 2023 the worst annual reading since 2020 when the index fell by 4% from 2019.

• The Truck Tonnage Index is a measure of the gross tonnage of freight transported by motor carriers in the U.S. for a given month.

• It serves as an indicator of shipping activity and consumption of goods in the U.S. (link)

Maersk Unveils World’s Biggest Methanol-Powered Containership A.P. Moller-Maersk A/S, the Danish shipping giant, has unveiled the world's largest methanol-powered container ship, named Ane Maersk.

• The 350-meter-long vessel was presented in Ulsan city, South Korea, and is expected to be operational by February 2024.

• The Ane Maersk has a capacity for 16,592 twenty-foot-equivalent-unit containers and will operate on routes connecting China, other Asian nations, the Middle East, and Europe.

• The ship is powered by green methanol, marking a significant step in Maersk’s strategy to achieve net-zero emissions by 2040.

• Maersk has ordered 24 container vessels equipped with dual-fuel engines capable of burning methanol, biodiesel, and conventional bunker fuel.

• The company plans to have 25 vessels that can run on green methanol — fuel that’s produced from sources like solid municipal waste, or hydrogen and carbon dioxide — through 2027.

• The unveiling of the Ane Maersk symbolizes the shipping industry's ongoing efforts to reduce emissions and align with the International Maritime Organization’s target of net-zero emissions by 2050. (link)

Daimler Truck and Masdar explore liquid green hydrogen Masdar, the Abu Dhabi Future Energy Company, and Daimler Truck have signed a Memorandum of Understanding (MoU) to explore the feasibility of exporting liquid green hydrogen from Abu Dhabi to Europe.

• This initiative is part of efforts to decarbonize road freight transport in Europe and aligns with the United Arab Emirates' (UAE) ambition to become a leader in the low-carbon hydrogen market by 2031.

• Masdar, a global leader in renewable energy, has developed projects in over 40 countries and aims to reach a renewable energy portfolio capacity of at least 100 gigawatts by 2030.

• The company has invested or committed to invest in worldwide projects with a combined value of more than $30 billion.

• Daimler Truck, committed to the Paris Climate Agreement, is planning to make its entire range of trucks and buses CO2-neutral in driving operation across major markets (EU, U.S., Japan) by 2039.

• The company is pursuing a dual-track strategy with both hydrogen- and battery-powered vehicles.

• In a demonstration of the feasibility of using liquid hydrogen in road transportation, Daimler Truck's prototype Mercedes-Benz GenH2 Truck recently completed a trip of 1,047 kilometers.

• The collaboration between Masdar and Daimler Truck is a significant step in ongoing efforts to tackle CO2 emissions in road freight and supports the global efforts to revolutionize transportation, reduce carbon emissions, and facilitate the international trade of green hydrogen.

• The primary goal of the MoU is to assess the feasibility of exporting liquid green hydrogen from Abu Dhabi to Europe by 2030. (link)

Other headlines 

Amazon Fined in France for Employee Monitoring in Warehouses. French Privacy Watchdog Hits Warehousing Unit for $35 Million.

Forward Air-Omni merger finally closes 3 months later than planned at roughly $2.1B, marking the end of a bitter legal dispute between the two companies.

Accenture and Mujin launch joint venture for robotics and AI in logistics. The JV will aim to help clients make faster, better decisions and hyper-automate their manufacturing and logistics processes.

EU teams up with several European ports in war on drugs in a new public-private alliance to help tackle drug smuggling and organised crime in the bloc.

Flexport plans to lay off 20% of workforce, say insiders - this would be a third round of layoffs in 12 months for Flexport.