Shipping will remain the NYK Line’s core business, but diversification and expansion into logistics are ‘essential’ to continued growth, according to the company’s new president.
Tadaaki Naito, the new president of ocean carrier NYK Line, told employees in a recent speech, “While shipping remains our core business, we are also following a differentiation strategy through a wide range of marine, land, and
air services beyond the boundaries of traditional shipping.”
Naito, who assumed his job last week, said that the origins of this strategy lies in the company’s group management vision, NYK21, which was created approximately 30 years ago.
“Since then, we have considered business diversification, such as expansion into logistics, to be essential in order to continue to grow in the 21st century. This transformation has required us to become a diverse, integrated logistics company focusing on all areas of distribution, rather than relying on the liner trade alone,” he said. “‘More Than Shipping’ has been our guiding light through the disorder following the global recession, and I firmly believe that we must continue to strengthen this differentiation strategy.”
Naito noted shipping companies grew their fleets through the mid-2000s in response to strong demand from China, but “this expansion also left us with the adverse legacy of excessive investment when demand contracted sharply due to the global recession that began in 2008.
“Considering that we are still burdened by this legacy, I believe that it is important to calmly and prudently verify in our investment decision-making process that we are fully in control of business profitability, or in other words, that we are not excessively dependent on factors outside our control,” he added.
“Nevertheless, it is without question that the shipping and logistics industries, including ocean transport, are promising growth industries,” said Naito. “We expect that the Asia region and emerging nations such as the BRICs will continue to show high growth rates going forward.”
In his speech, Niato told NYK employees they will need to be innovative and creative, emphasizing that this “is not the sole responsibility of certain divisions such as the Technology Division and the Marine Division.”
“This is a challenge that needs to unite the whole company in our actions — naturally in the sales divisions, who are in the best position to directly hear what our customers have to say — and also in the corporate divisions, which support the group’s infrastructure and work to eliminate waste and inefficiency in various areas.”
NYK president says company will continue logistics push
