P3 Alliance and Its Implications on Contestability in Major Gateway Ports in North America

Wei Yim Yap

Transportation Journal, 2014, vol. 53, issue 4, 499-515

Abstract: The P3 Alliance consists of the three biggest container shipping lines in the world. Together, Maersk Line, Mediterranean Shipping Company (MSC), and CMA CGM will command a combined market share of 36.4 percent of the world's active shipping capacity. Major gateway container ports in North America play a crucial role in serving the largest economy in the world and respective hinterlands that are embedded within. As such, the article aims to examine the impact of the P3 Alliance and its implications on contestability in the major gateway container ports in North America. Our analysis contends that the alliance should not be a cause of concern for the key ports of Los Angeles and Long Beach on the West Coast of the United States as the combined market share in terms of shipping capacity supplied matches up to existing capacity supplied by the largest of the other shipping alliances. However, the significantly higher market share for shipping capacity deployed by the alliance at major gateway container ports on the East Coast of the United States and stakeholding by Maersk Line's sister company APM Terminals and MSC's subsidiary Terminals Investment Limited in some of the ports could raise concerns for potential abuse of market power.

Date: 2014
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https://doi.org/10.5325/transportationj.53.4.0499

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Persistent link: https://EconPapers.repec.org/RePEc:wly:transj:v:53:y:2014:i:4:p:499-515

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