Throughout 2017, HMM made concerted efforts in all sectors and achieved numerous goals together.
Here are some of the highlights:
- With the deals with 2M and K2 concluded early last year, we successfully are making full use of our tonnages and have garnered synergy as result of the cooperation.
- Five VLCC and two 11,000 TEU containerships compliant with the new environmental regulations in 2020 were ordered or acquired.
- We acquired operational rights or partial ownership of several terminals at key hub ports in an aim to establish a long belt of hub ports connecting East and West, from the US west coast ports to Rotterdam in Europe.
- As a pan of our efforts in value creation, we developed logistics business opportunities and new joint ventures to be launched early this year.
- We achieved the four million TEU milestone in annual lifting in 2017 from three million TEUs in 2016, as we successfully regained support from customers through our strenuous efforts to rebuild our credibility.
- Substantial cost reduction was realized not only in variable costs, but in fixed costs thanks to “tonnage bank facility”, offsetting the increment in fuel cost.
HMM is convinced that these achievements have laid a solid foundation for their long-term plan where they continue to consider ways of doubling their vessel capacity by 2022 including the launching of mega containerships as we deem the environmental regulations in 2020 as a golden opportunity for our resurgence.
Under these circumstances, while we deal with such a fluid environment with flexibility and agility, we ought to persistently pursue Growth and Profitability.
The following are segment-wise directions:
- In the container sector, we need to design competitive products in newly added services in the East-West lane and offer a variety of differentiated products to the market, combined with expanded coverage in Asia through the cooperation with K2. We should also seek to double the efforts for sales promotion for the upgraded service with the implementation of proper pricing and marketing tactics.
- We need to reinforce yield management systematically and continue to pursue the optimal utilization of vessel assets and terminal assets.
- To increase the high valued special businesses, we will not only ardently develop new customers, but implement innovative marketing and operational knowhow.
- For further cost reduction in variable costs, we will keep pursuing a scale merit effect based on increased handling volume this year, intensifying the match back exercise and improving equipment velocity.
- In the logistics business development sector, we will make every effort to add value to existing business entities and get the newly embarked business units on track within a short period of time while consistently spearheading new business opportunities.
- In the wet bulk sector, we will make the most of the new order for five VLCC vessels as a precious momentum pivot for strengthening long-term business partnerships with prime customers over 2020. Also, the dry bulk sector should revamp the tonnages to be more competitive as the old chartered tonnages are being returned to owners, and in addition, we should exert great effort to reestablish relationships with customers in preparation for better market conditions.
- The maritime technology sector needs to improve the efficiency of ships operation in an aim to enhance the safety and fuel consumption of the ships and focus on all of the state-of-art technologies applicable to the building of mega containerships, in addition to keeping a close eye on new technologies, which may turn out to be a “game changer.”
- In the I/T sector, we have many projects to develop in the coming two years in preparation of the mega growth in 2020. They include the upgrade of operational and analytic programs together with equipment and ship optimization programs. Timely and periodic education on the I/T programs need to be carried out throughout the global organization.