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Home / Business / Companies / Freight and logistics

'Hubbing' diverts more business to Auckland

By Errol Kiong
18 Mar, 2008 04:00 PM2 mins to read

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KEY POINTS:

Tauranga's loss is Ports of Auckland's gain as it emerges the big winner from shipping giants Maersk and Hamburg Sud's consolidation of transport routes.

From the end of May, the two shipping companies will jointly operate a 12-vessel weekly Australasia-East Coast North America-Europe service combining Maersk's existing Oceania
and US East Coast services, and Hamburg Sud's Trident Service, which links Northern Europe with Australia-New Zealand via the Panama Canal.

The reconfigured route will see Ports of Auckland pick up the Trident service's import call at Tauranga, leaving Port of Tauranga facing an annual drop from June of approximately 20,000 containers _ around 5 per cent of the company's annual throughput.

But the company said the move was no surprise as shipping lines increasingly looked to alliances to improve efficiency.

Chief executive Mark Cairns said both companies would still have a strong presence in Tauranga, with one export call a week on the reconfigured service.

Ports of Auckland, meanwhile, is set to pick up Tauranga's shortfall as it becomes the only direct call in the new route for import cargo. General manager of sales, marketing and logistics Craig Sain said the announcement confirmed the confidence shipping lines had in its ability to handle the larger container exchanges brought about by hubbing.

Sain said hubbing _ where larger ships with more cargo called at fewer ports with regional ports becoming feeder ports serviced by smaller vessels _ was the reality of world trade today.

The global trend for a consolidation of shipping services has caused some volume volatility at New Zealand ports.

Last month, Ports of Auckland lost a contract with French container company CMA CGM to Tauranga, but recently gained business from Gold Star Line and Maersk.

Managing director Jens Madsen welcomed the move by Maersk and Hamburg Sud, but expected the volatile environment to continue.

"In the short to medium term, New Zealand and its ports are experiencing a period of intense change as shipping lines look to alliances and significant service changes to maximise efficiencies and minimise the pressure of increasing costs."

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