G6 alliance reduces transpacific services

G6 alliance reduces transpacific services
There have been numerous investments at Oakland

The G6 alliance is set to merge two of its transpacific services into one because of low demand.

The alliance is the latest carrier to cut capacity on the Asia-US West Coast (USWC) route because of low freight rates and a lack of trade.

In April 2015, the G6 alliance started running a CC2 transpacific service as well as its existing CC1 service.

From 19 June 2016 though, the CC1 service was suspended for one cycle lasting six weeks and the alliance has now announced that, from July 2016, the services will merge.

In July 2016, analyst Drewry said: “Depressed rates and slowing demand during much of the second quarter have now forced the carriers to withdraw services – action which is quite unprecedented just ahead of the third quarter peak season.”

According to the analyst, some US importers are shifting traffic to Canadian ports. In April 2016, while imports into Canada and Mexico increased, imports into the USWC fell. In May 2016, Drewry said “any rise in USWC demand was slight”.

CMA CGM has also recently decided not to use 18,000 teu ships on the Asia to USWC route despite highly-publicised plans to do so.

The G6’s CC1/CC2 merged service will now call at Qingdao, Ningbo, Shanghai (Waigaoqiao), Gwanyang, Busan, Los Angeles/Long Beach, Oakland, Busan and Qingdao.

The CC1 Service used to call twice at Gwanyang, but will now only call once. Other than that, the line-up of ports is an amalgamation of the CC1 and CC2 services.

The G6 Alliance consists of APL, Hapag-Lloyd, Hyundai Merchant Marine, MOL, NYK and OOCL.