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Hyundai Merchant Marine seeks to cement ties with Global Shipping Alliance

Logistic News - Published on Fri, 26 Apr 2019

Image Source: wsj.com
Wall Street Journal reported that the new head of South Korean flag carrier Hyundai Merchant Marine Co is on a charm-offensive trip to Europe to cement the shipping line’s relations with bigger peers, but sealing a deal to be part of a major shipping alliance will be difficult. HMM said Mr Jae-hoon Bae, who became HMM’s president and chief executive last month, will meet this week with executives at AP Moller-Maersk A/S and Mediterranean Shipping Co, the world’s two biggest container ship operators by capacity and partners in an alliance that moves roughly a third of all containers globally. The Korean line is an associate member of the 2M alliance but has less clout than the other two in decisions about capacity and routes, because some big customers insisted they didn’t want their cargo on Korean ships after the sudden collapse in 2016 of Korea’s Hanjin Shipping Co., then the world’s seventh-biggest container operator.

Mr Bae wants HMM to become a full 2M member next year, a person with knowledge of HMM’s efforts said. “But the best thing he’ll probably get is another loose relationship or nothing at all.”

HMM’s tie-up with the bigger lines, which began in 2017, expires next April. HMM holds 1.8% of the global shipping market, according to research group Alphaliner- on par with several regional carriers, but a far smaller market share than the biggest operators, including Maersk and MSC, which control the world’s big trading lanes.

Being part of an alliance that would let HMM cut costs by sharing ships, cargo volumes and port calls with its partners would be a boon for the company at a challenging time.

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Posted By : Rabi Wangkhem on Fri, 26 Apr 2019
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