HAMBURG: May 13, 2016. A new version of the 'G6' ocean container group called 'THE Alliance' is to be formed for a minimum period of five years by Hanjin, Hapag-Lloyd, "K" Line, Mitsui O.S.K. Lines, Nippon Yusen Kaisha and Yang Ming.

The six ocean carriers say their cooperation will begin in April 2017 subject to regulatory approval and cover all East-West trade lanes: Asia- Europe/ Mediterranean, Asia-North America West Coast, Asia-North America East Coast, Transatlantic and Asia-Middle East/Persian Gulf/Red Sea.

The new group will operate 620 ships with a combined capacity of 3.5 million TEU or 18 percent of the world's container fleet.

Hapag-Lloyd said discussions with UASC about combining their two container operations continue. If the two carriers reach an agreement, UASC would be included in the new alliance subject to regulatory approval.

In a related announcement, Hapag-Lloyd has reported revenue of €1.93 billion for Q1 2016 – down from €2.3 billion in the same period last year due to what it described as a "sharp decline in the freight rate" from US$1,331 per TEU in 2015 to US$1,067 for the first three months of this year.

Despite the combination of lower bunker prices and cost cutting that resulted in a Q1 EBITDA of €123.4 million compared to €283.6 million year-on-year, the net profit fell from €128.2 million in 2015 to minus €42.8 million for Q1 2016.

Hapag-Lloyd CEO Rolf Habben Jansen commented: "In the seasonally weak first quarter we recorded an acceptable result with a small operating profit and an EBITDA margin of 6.4 percent. This was due in no small part to
 the synergy effects which have been achieved so far as a result of the merger with CSAV and the improvements to our cost base under the OCTAVE [cost-reduction] program, which we implemented in 2015."