MSC takes on P&O, Maersk

By PAM GRAHAM

As regulators probe reduced competition in the air, the world's second-largest container shipper is launching a bold move into New Zealand's shipping lanes.

Mediterranean Shipping Company (MSC) yesterday announced a fixed-day weekly service to Europe via the Suez Canal from Port of Tauranga and a yet-to-be-decided port on the east coast of the South Island.

The company has been running a feeder service from New Zealand to Australia for about six years. From next year, 14 vessels on a European service that previously turned around at Australia, will come to New Zealand via a route through Suez instead of around Cape Horn. .

The service will be competing with P&O Nedlloyd's weekly fixed-day east and west-bound service to Europe which is operated in conjunction with other shipping companies, and services run by Maersk Sealand - part of the world's biggest container-shipping group.

MSC would not say if it was cutting prices to gain market share, though customers were in little doubt.

"They will have to come in with sharp pencils," said Brian Lynch, executive director of the Meat Industry Association, which represents exporters of 230,000 tonnes of product to Europe every year.

"The shipping industry, like the meat industry, is an industry that never sleeps. It is very competitive," he said.

Chilled meat exporters facing new security rules for cargo transiting the United States would consider west-bound services to Europe, Lynch said.

Murray Weatherall, MSC's general manager in New Zealand, said the new service was a major upgrade for not only MSC but also the New Zealand market because it provided an independent, direct service into Europe and into the Mediterranean.

"We feel there is room for an independent carrier with the size and scope that is global," he said.

The company was negotiating with three ports on the east coast of the South Island. P&O selected Auckland, Napier and Port Chalmers for its service.

Weatherall said the agreement with Port of Tauranga included use of Metroport, Tauranga's inland port in South Auckland.

Port of Tauranga chief executive Jon Mayson said anyone creating a new service into New Zealand had to win market share.

"It is a very bold step," he said. "Some of the volume they are targeting will be currently handled in other ports."

Tranz Rail picked up extra business when P&O Nedlloyd started its new European service. The company decided to use shuttle trains from Wellington to Napier for Wellington exports and imports, and a shuttle train from Christchurch to Port Chalmers. Pacifica Shipping will move freight from Nelson to Christchurch to connect with a shuttle train.

MSC's new service from New Zealand travels to Sydney, Melbourne, Adelaide, Fremantle, Singapore, Jedda, La Spezia, Antwerp and Felixstowe. Southbound the ships call at Antwerp, Felixstowe, Rouen, Le Harve, Valencia, La Spezia, Marseille, Pointe des Galets, Port Louis, Fremantle, Melbourne, Sydney, Tauranga and the port of the east coast of the South Island.

The first ship on the new service leaves Europe in January.