June 17 - The P3 Network - a global container shipping alliance planned by AP Moller-Maersk, MSC and CMA CGM - is officially dead in the water after the Chinese Ministry of Commerce (MOFCOM) said that it would rule out allowing the tie-up to go forward.
The P3 players have stopped work on the proposed network and it will not come into existence. Maersk Line group ceo, Nils S. Andersen explained: "The decision does come as a surprise to us, of course, as the partners have worked hard to address all the regulators' concerns."
International reports over the course of June claimed that Chinese authorities were poised to approve the P3 Network, which would see the three lines cooperate through vessel and slot sharing agreements on USA and Asia, North Europe and the Mediterranean trade routes.
"The P3 alliance would have enabled Maersk Line to make further reductions in cost and CO2 emissions and not least improve its services to its customers with a more efficient vessel network. Nevertheless, I'm quite confident Maersk Line will accomplish those improvements anyway. It has delivered on those improvements over the last five quarters in the absence of P3 and I'm confident it will continue to do so," Andersen added.
Vincent Clerc, chief trade and marketing officer at Maersk Line added: "In Maersk Line we have worked hard to address the Chinese questions and concerns. So of course it is a disappointment. P3 would have provided Maersk Line with a more efficient network and our customers with a better product. We are committed to continuing to be cost competitive and offer reliable services."
A Maersk Group statement said that P3 Network's failure to launch would have "no material impact" on the company's expected result for 2014. Shares in the company have fallen by 7 percent nonetheless.
CMA CGM said in a statement that "it is confident that it will maintain its operating performance and continue to over-perform the industry".