With overcapacity ripe on the Asia-Europe trade, HMM’s decision to add 12 ultra-large containerships and eight 15,000 teu vessels will not ease carrier fears.
Three South Korean shipyards are to share work on HMM’s plan to take its boxship fleet capacity to 1m teu.
HYUNDAI Merchant Marine has signed a contract with three South Korean yards to build the 20 containerships it previously ordered.
Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries will build seven and five 23,000 teu containerships, respectively, with delivery due to begin in the second quarter of 2020.
Hyundai Heavy Industries will build eight 15,000 teu vessels, with delivery from the second quarter of 2021.
The move is part of the company’s goal to reach a carrying capacity of 1m teu. HMM has a live fleet capacity of 391,546 teu, according to Alphaliner.
The ultra-large containerships will be deployed on the Asia-Europe trade, while the 15,000 teu units will be utilised on the transpacific and US east coast trades.
The order confirmation follows a shipping and shipbuilding restructuring plan announced by the government in Seoul. The plan includes orders of 200 newbuildings, including 60 boxships, by 2020 to be backed by state finance.
Many industry observers have questioned the wisdom of the order, however, as overcapacity is still a major issue, particularly on the Asia-Europe trade on which the ULCs will be deployed, and given the fact that HMM reported a $1.1bn loss in 2017, despite rising volumes.