Hong Kong "prime candidate" for alliance

Port of Hong Kong Kwai Tsing Container Terminals previously had five operators. Credit Hong Kong Maritime and Port Board

Hong Kong has "long been a prime candidate" for a terminal alliance, Drewry’s senior analyst for Ports & Terminals has said following the formation of the Hong Kong Seaport Alliance.

Speaking to Port Strategy after the announcement of the alliance between Hongkong International Terminals Limited, Modern Terminals Limited, COSCO-HIT Terminals (Hong Kong) Limited, and Asia Container Terminals Limited, Neil Davidson said terminal alliances are slowly being pursued by operators in ports where terminal capacity is fragmented.

He stated: "We've seen it already in Miami and Colombo for example, and Hong Kong has long been a prime candidate due to having numerous operators and terminals."

Strength in numbers?

The Seaport Alliance will offer a total of 23 berths and the planning for which is conducted by an Operations Coordination Team using a common terminal operating system.

With this alliance, the terminal operators should be able to use their facilities more efficiently overall and provide better service for shipping line requirements. "If this works for Hong Kong it should increase the port's competitiveness," he pointed out.

The alliance won't come without challenges though as unlike shipping lines, terminal operators have to deal with the fact that every terminal is different  so sharing assets is not automatically equal and easy to organise. Terminal alliances aren't straightforward, he stresses, but experimenting with  the concept is important for the industry. "setting out the rules for a how terminal alliance will work is complex and challenging and it might be hard to find a win-win for all. Nevertheless, it's vital to try."

Looking ahead to other potential terminal alliance opportunities, he identifies Busan, Kaohsiung and Japanese ports such as Tokyo, Osaka and Kobe as being among ports in Asia with fragmented terminal capacity. In the US, Los Angeles/Long Beach have a similar setup.

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