HMM to spend $17.5 bn by 2030 to double cargo capacity

HMM Co., South Korea’s largest ocean carrier, said on Tuesday it will spend 23.5 trillion won ($17.5 billion) by 2030 to nearly double its cargo capacity and expand its integrated logistics services to become a leading logistics company.

Its CEO Kim Kyung-bae said in a news conference that the company aims to expand its load capacity to 1.55 million twenty-foot equivalent units (TEUs) by 2030 from the current 920,000 TEUs.

One TEU equals one 20-feet container. The 920,000 TEU is the maximum cargo volume of 84 container carriers. 

For bulk cargo services, it will increase the load capacity of its fleet of bulk ships from the current 6.34 million deadweight tonnage (DWT) to 12.56 million DWT by 2030. DWT is a measure of the weight a ship can carry.

To meet the goal, it will expand the fleet of its bulk carriers to 110 units by 2030 from the current 36 ships.

"We will achieve 15 trillion won in revenue by 2030 with assets of 43.2 trillion won and become a leading logistics company in South Korea," Kim told reporters.

The revenue and asset targets are 82.9% and 68% higher than its 2023 achievements, respectively.

The breakdown of HMM's 23.5-trillion-won spending plan (Unit: trillion won)
Container shipping	12.7
Bulk cargo	5.6
Integrated logistics services	4.2
Low emissions and service digitalization	1.0

PREMIER ALLIANCE

The detailed spending plan was unveiled after HMM recently formed a five-year strategic partnership, dubbed the Premier Alliance, with Singapore-based Ocean Network Express (ONE) and Taiwan’s Yang Ming Marine Transportation, as an alternative to THE Alliance.

The three-way partnership will be launched in February 2025, when Germany’s Hapag-Lloyd is slated to exit from THE Alliance to join Maersk in the Gemini Cooperation.

They are two of the three key global liner alliances, including the Ocean Alliance, which features CMA CGM, Evergreen and COSCO.

On Monday, the Premier Alliance said that it has agreed on slot exchange cooperation with Mediterranean Shipping Company (MSC), a leading shipping line headquartered in Switzerland, for Asia-Europe trade, starting in February next year.

The agreement comes as HMM is seeking to expand its integrated logistics services, or end-to-end port container services. To do so, it will expand its cargo terminal facilities and secure additional container terminals at global logistics hubs, Kim said.

"Now the Premier Alliance has agreed to join hands with MSC, HMM will need to build competitiveness on routes other than Europe, such as the Atlantic, South America and Africa,” said a shipping industry official.

ADVANCING ZERO-EMISSIONS TARGET

HMM will also bring forward the zero-emissions target to 2045 from 2050 by shifting toward low-carbon vessels. 

Meanwhile, industry observers warned HMM's financial goals could be vulnerable to its top shareholders' privatization plan for the sea carrier.

The Korea Development Bank and the Korea Ocean Business Corp. earlier put their majority stake in HMM on the market.

But their attempt to sell it faltered after its preferred bidder Harim Co., a poultry processor, walked away from the $5 billion deal in February. 

Write to Jin-Won Kim at Jin1@hankyung.com
 


Yeonhee Kim edited this article.