Do Mergers And Alliances Influence European Shipping And Port Competition?

Abstract

New horizontal and vertical integration agreements among the previously separate players in the international shipping and logistics industries are changing the characteristics of services and the structure of the industries. This paper reviews the types of agreements being entered into; examples given are within or affecting Europe. The paper notes that greater integration in the industries may enable improved quality and efficiency of services for shippers. It also notes that the integration changes the amount, nature and incidence of competition in the industries. Particular attention is given to the strategic implications of the changes for ports. The presence of a large fixed infrastructure in the costs and the increased role of the private sector and commercial objectives make the appropriate response of ports uncertain. With the ultimate results of the shifts in market power uncertain, more research is needed on the effects of greater integration in the industry on efficiency, conflicts of interest and on the possible effects of market dominance.