HMM holds Trade Get-Together for its key clients in Mumbai

Posted by Daily Shipping Times on 07-05-2018        Tweet

•             CEO Mr. Yoo shares its mid-long term strategical plans with the customers

•             Elevated the Mumbai office from ‘Subsidiary’ to ‘Headquarter’, targeting the emerging market

Mr. C. K. Yoo - President and CEO address at Mumbai Event

SEOUL/MUMBAI: HMM hosted an Trade Get-Together on April 5th at St. Regis Hotel, Mumbai to further enhance the communication between its valued customers. The event was attended by almost 150 relevant VVIP Customers and Port officials.

HMM’s CEO Mr. C.K. Yoo, shared HMM’s status and position, together with its mid-long term strategic plans with the VVIPs, and assured to provide exclusive premiere service to its customers.

With India’s high economic growth and the improvement of Container market, HMM has been aggressively expanding its sales activities within the region. HMM currently operates seven services and ten vessels between Asia-India, and its export volume from India last year increased almost 70% year-over-year.

Prior to this event, Mr. Yoo attended the opening ceremony of relocated and elevated India office and visited HMM’s ‘Global Document Center’ to encourage and communicate with local Employees.

With the continuous growth of Indian market, HMM – as Korea’s first shipping carrier – has established India’s local subsidiary company in 2005 and has elevated its status from ‘subsidiary’ to ‘Headquarter’ last September. 

Meanwhile, HMM previously held its explanatory sessions about current shipping industry in Seoul and Busan, Korea. 

First of all, I would like to extend my sincere gratitude to our Guests here for kindly sparing valuable time to be with us for the opening ceremony this event.

And my special thanks to Capt. Sandeep Mehta, President of Adani Ports and Special Economic Zone, Mr. Shashi Kiran Shetty, Executive Chairman of Allcargo Logistics, and Mr. Sameer Tendulkar, Group Director at Allanasons.

My first visit to India was in 1993, and the second one was in 2013. This is my third visit.

Over the years, I have found that there have been unthinkable changes. So much so happened to the Global shipping industry.

Since the financial crisis in 2008, 10 years have passed. The global shipping industry has undergone an unprecedentedly difficult times. HMM was no exception. Regrettably, HMM was hit harder as we failed to join the group of building Eco Mega containerships in early 2010s.

As you have witnessed, there have been numerous Mergers and Acquisitions in the global shipping industry in the last 10 years and some of them are still on-going.

However, we have been fortunate enough to successfully overcome these challenges and survived. We not only survived but are now resiliently seeking our own growth strategy.

Our strategy is based on the three important assets: Number one, our long-time customers like you and the other one, a very competitive new environmentally friendly containerships in compliance with the new regulations in 2020. And, the third one, our dedicated human assets in HMM.

Thanks to your support, HMM achieved a remarkable growth in terms of its handling volume last year, breaking 4 million TEU thresholds, comparing 3 million TEUs in the previous year.

This year we continue to do our best to cater to the customer needs. Lately, we announced that we would launch the operation of an independent Asia-North Europe Express (AEX) service starting April 8th.  In the 2nd half of this year, we will deploy new two 11,000 TEU containerships to Asia-South America service.

In the longer term, as I explained earlier, we plan to order new eco-friendly mega containerships in the first half of this year, with which we may not only strengthen our competitiveness and compliance with the new environmental regulations but upgrade our service coverage, particularly in Indian continent. In wet bulk sector, we will launch five VLCCs installed with scrubbers in the market from next year.

Since the inception of our CIX service in 2006 and ACS service in 2007, we have kept expanding the services in line with the growth in India and become one of the major operators in the region.

Currently, HMM operates six Indian services which cover almost every main port in India in order to proactively respond to the fast-growing Indian market. Since last year, HMM has been operating two main Indian service routes, CIX and ACS, with upsized vessels. Moreover, in the second half of this year, HMM plans to operate those two services independently after termination of joint operation with GSL to meet ongoing customer needs.

We would not have been able to make these achievements without your unwavering support in HMM, and for this, I would like to express my sincere appreciation to all of you again. As always, we are committed to continue to develop and provide our customers with diversified and convenient services ever. In addition, we will continue to make our best efforts to ensure high quality service and reliable operation for our valued customers.

In 2017, HMM struck successful deals with 2M for cooperation agreement, maintaining cooperative relationship with other partners all over the world. Also, as sign of the continued growth of our global services, we were ranked No.1 in on-time global performance last August and October.

This opening ceremony is meaningful as it is coincided with the announcement of the rebuilding plan of Korean shipping Industry by Korean Government. The opening ceremony is heralding the new era of HMM in coming years.

You may have heard the proverb: “If you want to go fast, go alone. If you want to go far, go together.” In the same way, we intend to share our experiences and knowledge, and grow together with you, as a good partner.

Hyundai Merchant Marine CEO & President C. K . Yoo in an exclusive interview with Daily Shipping Times

The year 2017 was quite good for HMM in terms of Regaining Customers Trust, Recovering Profitability and being at Top of Schedule Reliability? How do you see HMM performing in current year?

Since the Korea Development Bank (KDB) has become HMM’s largest shareholder in 2016, HMM has focused on rebuilding customer trust and improving sales performance. Based on our concerted efforts in all sectors, we achieved numerous goals throughout 2017.

This year, we continue to do our best to cater to the customer needs. Lately, we announced that we would launch the operation of an independent Asia-North Europe Express (AEX) service starting April 8th. Also, in the 2nd half of this year, we will deploy new two 11,000 TEU Containerships equipped with scrubbers to Asia-South America service.

Moreover, HMM considers new orders for new eco-friendly mega containerships in the first half of 2018 to comply with the new environmental regulations scheduled to become effective in January 2020. I believe HMM will be able to achieve a turnaround in the third quarter of 2018 given its improving financial status and business conditions.

 

HMM has achieved a landmark feat of handling 4 million TEUs in 2017 vis-a-vis 3 million TEUs in 2016. How did you achieve this feat?

We achieved the four million TEU milestones 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. HMM is committed to continuously improving its service quality with new services like the Ultra Freezer service and the US Premium service, as well as adoption of IoT technology. We will continue to develop better services to meet various customer needs.

 

Recently HMM has secured USD 420 million funds for 5 VLCCs? What are your future expansion plans after this one?

At HMM, we considered that last year was the right time to order new vessels at the lowest market prices for new shipbuilding and accordingly HMM ordered or acquired five VLCCs and two 11,000 TEU Containerships compliant with the new environmental regulations in 2020.

In the longer term, we plan to order new eco-friendly mega Containerships in the first half of this year, with which we may not only strengthen our competitiveness and compliance with the new environmental regulations but will upgrade our service coverage too.

 

Major Shipping Lines World over have started using or are adopting new technology like Blockchain, Artificial Intelligence among others for improving efficiency? How is HMM planning to embrace such technologies?

As our world becomes more and more technologically advanced, new technologies join the shipping industry as well, in order to reduce costs and improve operational efficiency. HMM is also reviewing various ways to improve its services and quality through adopting IT technologies.

HMM has successfully completed its pilot operation of Internet of Things (IoT) technology on reefer containers in August last year. With IoT technology, information on cargo status, such as location, temperature, humidity, and so forth, can now be monitored and managed live in real-time. Combining Blockchain technology with IoT technology will also expand the range of IT systems for the shipping industry.

Furthermore, HMM will begin adoption of a next generation Cloud-based system, with planned full implementation by 2020.HMM also prepares to utilize Big Data in calculating best routes considering tides, direction of winds, or weather conditions etc. Besides, HMM is committed to continually investing in IT staff professional development through in-depth education and recruitment.

We aim to become one of the pioneers of the Fourth Industrial Revolution within the industry by applying high-end IT technologies to shipping and logistics.

 

Most of the Shipping Expert expects the mergers and acquisition to continue in the current year as well? Would you endorse this view and why?

There have been numerous mergers and acquisitions in the global shipping industry in the last 10 years and some of them are still on-going. I think there would be more M&A activity, if the game of chicken would continue in the global shipping market with severe imbalance between supply and demand.

However, we have been fortunate enough to successfully overcome these challenges and survived. We not only survived but are now resiliently seeking our own growth strategy.

 

For the first time since financial crisis of 2007-08, the growth in International Trade has been little higher than Global GDP growth in 2017. How do you see the scenario shaping up in current year given rise in chorus for protectionism among major economies? 

Since the financial crisis, the global shipping industry has undergone an unprecedentedly difficult times. And now, protectionism has raised fears of trade deficits. However, it is difficult to forecast how protectionism will impact shipments of export cargo and import cargo in international trade, as many studies failed to prove the impact of trade liberalization on container traffic.

Whereas according to latest reports from various maritime research institutions, there are positive prospects of the world economy this year overall. They also cited protectionism, unstable oil prices and regional oversupply of tonnage as negative challenges for the shipping industry. Under these circumstances, while we deal with such a fluid environment with flexibility and agility, we ought to persistently pursue Growth and Profitability.

 

What is your take on the Indian Market? Do you have any India specific plans for expansion? 

India is expected to become the world's third-largest economy in terms of nominal GDP. HMM has conducted its India services for more than 10 years with a market share of 17% in East India, and 8% in West India, expanding services on neighbouring countries of India as well.

Since last year, HMM has been operating two main Indian service routes, CIX and ACS, with upsized vessels. Moreover, in the second half of this year, HMM plans to operate those two services independently after termination of joint operation with GSL to meet ongoing customer needs.

HMM is well aware of the importance of India as a growing market, and we continue to expand our presence in India. For instance, HMM has opened the new Global Documentation Center (GDC) in Mumbai in 2004 and has established its subsidiary in India a year after that. Last year too, HMM upgraded the Local Office to Regional Headquarters.