The industry has been battling overcapacity since the financial crisis because new vessels ordered before the downturn have flooded the market. This has driven rates on the main route between Asia and northern Europe to loss-making levels.

The proposed P3 Alliance is among Maersk Line, a unit of A.P. Moller-Maersk, Switzerland-based MSC Mediterranean Shipping Company and France's CMA CGM.

To cut costs, they have agreed to pool about 250 ships which will operate on three trade routes: Asia-Europe, trans-Pacific and trans-Atlantic. This would allow the firms, which currently run many of their vessels only partly laden to run larger, more fuel-efficient ships fully loaded.

The grouping has been criticized by cargo owners and shippers' groups because of fears it could dominate the key routes, pushing out smaller carriers and potentially driving up prices.

Read Full Article