A Positive Case for Ocean Alliances; Using Zim Discussions as a Teachable Moment

Ocean shipping conversations often blur the line between alliances and consolidation. This episode breaks down how carrier alliances function in practice, why vessel sharing can improve routing and efficiency, and how ownership changes raise very different competition concerns. Using the ongoing discussion around ZIM as context, we connect market structure, port leadership transitions, and regulatory timing to real-world supply-chain resilience.  

Expanded Summary 

Ocean shipping conversations often lump alliances and consolidation together—but doing so misses how the market actually functions. 

In this episode of By Land and By Sea, we take a closer look at ocean carrier alliances and make a clear distinction between cooperation and ownership. Using a plain-language aviation analogy, we explain how vessel sharing can increase routing options, enable more direct services, and improve equipment utilization—sometimes benefiting shippers through better network design and operational efficiency. Alliances, when properly structured, allow carriers to share assets while still competing for cargo. 

We then use the ongoing discussion around ZIM as a case study—not as breaking news, but as a lens into how ownership changes differ from alliances and why acquisitions raise fundamentally different competition concerns. Consolidation permanently reduces the number of independent decision-makers in the market, which is why these conversations draw sustained attention from regulators, ports, labor, and governments. 

From there, the episode widens the aperture to leadership and governance shaping the supply chain this week:
 ⚓ The official announcement of Dr. Noel Hacegaba as the next CEO of the Port of Long Beach
⚓ A reflection on last week’s personal conversation with outgoing CEO Mario Cordero, and why leadership stories matter
⚓ A brief update on Senate procedural movement affecting pending FMC and MARAD nominations, and why we’re “oh so close” 

Taken together, this episode is about structure—how alliances, ownership, leadership, and regulatory timing interact to shape competition and resilience across global supply chains.  

🎧 Episode: A Positive Case for Ocean Alliances
👉 Listen: www.TheMaritimeProfessor.com/podcast 

Chapters

• 0:11 Setting The Stage: Industry Signals
• 1:01 Meet The Host And Mission
• 1:39 Zim Rumors As Teaching Moment
• 2:54 Alliances Versus Consolidation Explained
• 5:01 How Vessel Sharing Boosts Efficiency
• 6:42 Aviation Analogy For Alliances
• 8:23 Why Ownership Changes Shift Power
• 10:51 Should The U.S. Consider Buying In
• 13:16 What Shippers Should Watch
• 16:20 FMC Oversight And Antitrust Basics

Transcript

SPEAKER_00: 0:11

We're listening to By Land and By Sea, powered by the Maritime Professor. Breaking news, other weeks bring clarity. This week would probably be more in the second category. Well, look, we didn't get many headlines this week that really rewrote the rules of ocean shipping. There's a lot of things kind of brewing and percolating out there. That is for sure. I was in DC this week. There's a lot going on. But we did get some signals, perhaps, about where this industry is heading. Market structure, leadership of critical gateways, and who may soon be setting the rules at key federal maritime agencies. And when you put those signals together, they do tell a pretty important story. I'm not able to share everything out of DC, but I do have some pretty, pretty interesting things I'd like to share. Hi, welcome back to By Land and By C, an attorney breaking down the weekend supply chain, presented by the Maritime Professor. Me, I'm Lauren Beegan, founder of the Maritime Professor, former FMC International Affairs Attorney, and founder of School Strategies. By Land and By C is your go-to resource for navigating the regulatory side of global ocean shipping. And me? Well, I'm your favorite maritime attorney. As always, this podcast is for educational purposes only and is not legal advice. There is no attorney client privilege created by this podcast. And if you need an attorney, contact an attorney. So let's get into it because as you know, ocean shipping moves the world. All right. Well, this week I wanted to start with a topic. It's not new this week. We really haven't covered it much, but it continues to hang over kind of the ocean shipping liner shipping market. And it's about this ongoing discussion around Zim and potential ownership changes. So look, I'm not here to chase rumors. I don't want to do that. I will, I just like to break down what I'm hearing. I always say I'm not trying to make the news, I'm just trying to explain the news, perhaps. I want to use Zim as perhaps a teaching moment because I think that it highlights something that often gets misunderstood in ocean shipping. And it really is the difference, the difference between carrier consolidation and carrier alliances, ocean carrier buying and selling of companies and ocean carrier alliances. Now I know COVID congestion, ocean alliances, and global ocean alliances, they sometimes got a bad rap. They were often blamed for these higher rates or reduced choice, but look, that's not really true. That's not really how it functions in practice. And that's why I wanted to use this as an opportunity to kind of explain some of that. Now, when one carrier buys another carrier, that's a permanent structural change, right? For the most part. Ownership changes arguably reduce the number of independent competitors in the market. Fewer companies setting prices, assigning networks, and competing for cargo, right? That's where we start to get that market concentration. If you've listened to my episodes where Sal Mercagliano's on here, we often talk about that. Where ocean carrier alliances, these vessel sharing agreements, are better suited to give better routing, better availability. They maintain that competition. But if you have the reverse, if you have companies either not in this necessarily situation, but if you have companies like Hangin going bankrupt, that creates market concentration, right? Now alliances are different. It's not market concentration necessarily. Alliances do not merge the companies. Each carrier remains independent. They still set their own rates, right? And ocean alliances. They still set their own rates, they still negotiate their own contracts, they still compete for the same customers. These ocean, these global ocean alliances are operational tools. They allow carriers to share vessel space. Share vessel space. They're operational. They coordinate sailing schedules and critically use equipment more efficiently. I've often said, look, we used to have it where we had these giant vessels that were going out, and maybe they were three or four of them all on the same route, half full. But because of global ocean alliances and because of vessel sharing agreements, now they don't have to be half full. They can all kind of pile into one vessel, and then those other two vessels that were also half full doing the same route can go off and do other ports and terminals. So that now you have more routes, other routes that you can go to. This efficiency can actually benefit shippers, right? Alliances. They can mean more routing options, like I just explained, access to better or more direct routes, maybe smaller ports, maybe closer to warehouses that you need, and sometimes better rates because the ships are being filled more efficiently. Look, the easiest way to kind of think about this is in aviation. I often use this example. I've talked about it many times on here before. Look, let's say you want to fly Boston to Denver, and you have your options of different aviation carriers that you could take. If you take Southwest, you might have to stop in Kansas City first. Not because you want to, you aren't going to Kansas City, you're just trying to get to Denver, but because perhaps that's how their network or their route was built. That's on the route. But look, if you fly Delta, you can often go direct places because you might not even realize that you book through Delta. That might be operated by Eagle Air or Regional Air or some other airline or some other regional company, but it doesn't matter. You book through Delta, and that's all you know, and that's really all you care about. Your interface is Delta, that's where the points are. That's the relationship you care about. That's the example for ocean shipping. That's what we're doing with these global ocean alliances. They are vessel sharing the same way these are aircraft sharing. Now, there are some differences, right? That's domestic example versus an international example with global ocean alliances. But that's kind of what I wanted to distill down to that basic level, right? Alliances allow carriers to share ships so that they can offer better networks without eliminating the competition between companies. And that's why during COVID congestion, we still saw the FMC saying, look, there is congest or there is competition out there. The rates were going up because a 40-foot box is still a 40-foot box. And everybody was buying large things, right? We were all buying couches, we were all buying rugs, we were all buying all these things to stay in our house. And so a 40-foot box was still a 40-foot box. And so, you know, if you have I'm not going to go to the all the economics, economics of it all, but look, you still had the competition. A sale of a company is different, right? A sale of a company means one company potentially disappears as an independent competitor, right? And that's why regulators, shippers, and ports pay far more attention, potentially, to ownership changes than to vessel sharing agreements. I mean, I think they're both watched, but ownership changes are very different. And that's what I'm trying to highlight today, right? This is about analysis, not reporting. With all this discussion around Zim, I almost kind of wonder, though, are we missing a bigger strategic question? And, you know, being in DC this week, there was a lot of talk about US maritime priorities, U.S. maritime initiative, all of these things. And so it got me thinking, okay, well, if Zim is for sale, should the United States be thinking about this acquisition? If the goal is to be internationally competitive in ocean shipping, I mean, I do think we need to be honest about the timeline. I do think we are ramping up incredibly fast, probably faster than we've seen in a while. We have so much money coming into Maritime right now for shipbuilding and all of these different things. But if the goal is to be internationally competitive in ocean shipping, we need to be honest about the timeline. In the interim, perhaps one way countries enter industries they want to compete in is by acquiring established players, right? I mean, that's not specific to maritime, that can be all over the place. That's not like getting into an industry. It is getting into an interest industry, right? If you purchase it. So, yes, we have US flag companies operating internationally, but buying into an established global carrier with existing routes, customers, operational expertise, it may be a strategy we might want to think about. Like, I'm not saying it's happening, I'm not saying it's on the table. It kind of just, as I was on the flight, it kind of popped into my head and something I was thinking about. But it's an industrial policy thought, right? I mean, there might be something there because like ownership isn't just about the ships, it's about the network, it's about the presence, it's about the leverage, it's about the the larger world. This is why the shippers should care, though. Okay, so that that perhaps maybe the US could find something interesting there to work with. But why should shippers care? Why should we be paying attention? Why should shippers be paying attention to the SIM potential sale? Look, you might not feel consolidation immediately, right? But over time, fewer independent carriers out there can mean fewer options, less leverage, less competitive pressure, right? Alliances rebalance space. They have a better utilization of space. Now, ownership changes rebalance power. Look, we know this. If you listen to my show, under the Shipping Act, carrier alliances operate with limited antitrust immunity. That's kind of the benefit of filing these agreements with the FMC. That is the benefit of filing these agreements with the FMC. They get limited antitrust immunity to kind of allow them to be a little bit more creative for the benefit of the U.S. importer, exporter, and consumer. That is the FMC's mission for the benefit of the U.S. importer, exporter, and consumer. Subject to FMC oversight, the FMC is watching these agreements that are filed with it. Anybody who gets this limited antitrust immunity, the FMC is watching them. They're monitoring them. They are a competition authority. Now that framework exists specifically to allow operational efficiencies, as I keep saying, like vessel sharing and coordinated schedules while preserving, preserving competition at that commercial level. Even within ocean carrier alliances, even within these vessel sharing agreements, the ocean carriers are competing. They are competing. Carrier acquisitions are different. Ownership changes fall outside of this alliance immunity and raise traditional competition thoughts because they eliminate independent decision makers from there. It's buying and selling of companies. And I don't want to go too far down there. My point really, really is, and I don't want to say, you know, buying and selling of carriers is not a good thing, andor companies is not a good thing. I'm not assessing judgment to it. I just wanted to point out the difference because oftentimes ocean carrier alliances, global ocean alliances are often kind of critiqued as though they were mergers, but they're not. They are vessels sharing, equipment sharing, operational agreements. The competition is still there. But when companies go in and out, up and down, bankrupt like Hanjin, that's where it changes the whole market. It changes the whole network. And that's where the FMC and competition authorities all over really treat mergers and acquisitions different than these special sharing agreements. Look, even where both, even when both affect capacity and service patterns. But I wanted to highlight that difference. I wanted to bring it up because what we're seeing now buying and selling of ocean carriers, it's fine. But also, that's I I wanted to take the heat off of global ocean alliances because those really are supposed to be providing better routes, better services, better options for the shippers. And that's why the FMC through Antitrust Limited, Limited Antitrust Immunity and the Shipping Act, that's part of the benefit there. So I just wanted to highlight that as Zim and is continues to be in the trade press. Like I said, there's a lot going on there. I don't want to get into all of the details of what's going on, but those are the differences, right? That's the difference between buying and selling of a company versus vessel sharing agreements. All right, let's slide over to the Senate now. This week the Senate continued procedural work related to the nominations of Lord Bella and Bob Harvey for the Federal Maritime Commission and Steve Carmel for the Maritime Administration. I don't want to spend a lot of time in the weeds here because look, cloture vote, Senate procedure, it can get very technical very quiet, very fast. And as you know, I'm a global ocean shipping and maritime law expert. And I'm like more of a congressional enthusiast than a principal procedural junkie there. So I don't want to get it wrong, but I do want to bring it up because here's the takeaway. There's still some procedural housekeeping happening here, right? We're trying to get the final confirmation, and we are oh so close. I mean, we I think we might even be there, but I I don't want to get ahead of I like I said, I don't make the news, I don't break the news, I just react to the news. We are oh so close. Look, these nominees, I think that they've cleared committee. They that they've been substantially vetted, they had their hearing. It's just timing, it's not qualifications at this point, it's just timing. And look, leadership at FMC and Marad matters, the momentum is there, and we are oh so close. So I'm I'm so hopeful. I'm so hopeful that this gets done in the next week, in the next few days, in the next few hours, and that we get leadership in place in these maritime areas because maritime remains one of the most important topics that we as a nation can be talking about. I mean, I'm partial, right? I'm partial to the maritime conversation, but it really is so important and we got to get the leadership there. I want to head back to what the conversation we had last week and a little bit more. News had just broke that Dr. Noel Haskaba was officially elevated. Now this week he's officially announced as the next CEO of the Port of Long Beach, effective January 1, following the retirement of Mario Cordero, who is who we had a conversation with last week, right? We sat down with Mario Cordero for a wide-ranging personal conversation on this podcast. Mario and I worked together years ago at the Federal Maritime Commission, and that episode, to me, really reflects on his leadership, his career, and what his tenure at Long Beach has meant for the industry. And was just a really special interview as well. It was it was just so nice to catch up with him, anyways. But then to kind of walk through, you know, it was almost as if we were catching up and we just happened to have record on. So we got to walk through our experiences together at the FMC and a few different stories that Mario had through the years. If you haven't listened yet, go back and give it a listen. It's not a policy briefing, it's not even really it's well, it's a it's a leadership story, it's it's just kind of a conversation. But also what I wanted to bring back around today is look, Dr. Hasagaba's appointment is so exciting. And it also signals continuity at a critical time, right? As ports are navigating infrastructure investment, environmental mandates, and rising performance expectations, it's great to see that the Port of Long Beach hired from within. Dr. Noel Hasagaba has been the COO for quite some time. I am so encouraged and so happy and so excited for him to be in that role. I think he's gonna do wonderful things at the Port of Long Beach. So, look, this wasn't a long talk conversation today, but I wanted to hop on and let you know a few of the things that I was, I was just kind of chewing on myself, right? Look, leadership matters, governance timing matters, understanding how ownership alliance, support leadership, and federal oversight interact, it especially matters. It's no longer optional. It's strategic literacy. And I keep saying this, but if you know the rules, you make better decisions. But look, that's why you have me, right? That's why you have the Maritime Professor. Look, if you like this episode, be sure to follow, subscribe, and leave a review. Want to go deeper on these topics or bring this on an insight to your team, visit the maritimeprofessor.com to explore corporate trainings, tailored briefings, and on-demand webinars, all designed to make complex maritime regulations practical and easy to understand. I think you know this, but I actually started this whole education side because I had motor carriers and truckers following me on Twitter asking me, could I explain some topics? And here we go. We have a full company based on that, the maritimeprofessor.com. That's what we're here for. We want to help provide explanations through the podcast, through the corporate trainings, through the tailored briefings. And if you want just webinars, webinars to help onboard your new employees or just make sure that you're filling in gaps of knowledge. But if your organization needs help navigating the legal or strategic side of ocean shipping, head over to Squell Strategies. That's where I provide those consulting services, regulatory guidance, and policy support. As always, this podcast is for educational purposes only and should not be considered legal advice. If you need an attorney, contact an attorney. But until next time, thanks for joining us here. I'm Lauren Beegan, the Maritime Professor, and you can just listen to Byland and by C. See you next time.