HMM said it increased volume 150 percent in two years as it prepares for megaship deliveries in 2020.
C.K. Yoo, the president and chief executive officer of Hyundai Merchant Marine says 2019 will be a transition year for his company as it prepares for a “quantum leap” in 2020 when it takes delivery of 20 eco-friendly mega vessels that will nearly double HMM’s fleet.
In a new year message to colleagues, Yoo highlighted the new ships being built for HMM at Korean shipyards of Daewoo Shipbuilding & Marine Engineering (DSME), Hyundai Heavy Industries (HHI) and Samsung Heavy Industries (SHI). These include a dozen 23,000-TEU ships and eight 15,000-TEU ships that will boost the company’s capacity by 496,000 TEUs.
In November, Yoo said HMM is seeking to have a fleet with capacity of 1 million TEU and revenue of $10 billion by 2022.
Cost competitiveness and mega containerships “will play an important role for HMM in obtaining economies of scale. This strategy will lead to additional cost reduction,” he said.
The 20 new ships won’t get HMM all the way to its 1 million TEU goal, but it will get it much closer by nearly doubling its fleet size. Alphaliner currently ranks HMM as the world’s ninth largest container carrier with a 72-ship fleet with 424,381-TEU capacity (14 owned ships with 129,439-TEU capacity and 58 chartered ships with 294,942-TEU capacity).
Yoo said the larger ships also should “be accompanied by software, including a global network, IT and improvement in customer service, based on our sales strength.”
He also noted the challenge the industry faces from the new requirements from the International Maritime Organization that ships reduce sulfur emissions starting in January 2020. This past summer HMM launched two 11,000-TEU ships equipped with scrubbers and says all 20 of the other ships it is adding will be equipped with scrubbers.
HMM said last year it moved about 4.5 million TEUs, a 150 percent increase in volume since 2016 when it carried about 3 million TEUs.
Yoo noted HMM has launched an Asia Europe Express service connecting Asia with North Europe to prepare for its introduction of the mega vessels in 2020.
To explain his expectations over the next two years, Yoo used a botanical analogy. He noted that MOSO bamboo grows slowly, “only 3 centimeters after four years of sowing, but from the fifth year onwards, it grows to over 30 centimeters in a day and forms a dense bamboo forest in just six weeks. … Just as MOSO bamboo can powerfully stretch out when the time comes, we will make preparations firmly rooted in the ground during a four-year period of difficulty. The seeds of HMM’s quantum leap were sown two years ago and 2020 will be a year of leap for us.”
Hyundai Merchant Marine prepares for ‘quantum leap’
