SOUTH Korea has plans to launch a shipping alliance for five of its container shipping companies serving Southeast Asia, reports The Maritime Executive, Fort Lauderdale, Florida.
The alliance will include SM Merchant Marine, Hyundai Merchant Marine, Janggeum Merchant Marine, Pan Ocean, and Heung-A Line, all of which operate Southeast Asia routes.
The five companies represent half of the regional container volume to and from South Korea. The alliance will be similar to the global shipping companies, and it'll hope to enhance regional competitiveness and reduce operating costs.
The companies are preparing detailed regulations for the alliance and identifying the optimal fleet for each route. The alliance is expected to launch as early as the second quarter of 2021.
The move comes as South Korea's market share is gradually declining due to aggressive investment by global shipping companies. 480,000-TEU departs from South Korea each year, with 40 per centof it being moved by Korean shipping companies.
The overall goal of the alliance is to strengthen the competitiveness of the national carriers in Southeast Asia and to realize the growth potential in the region.
Officials hope it'll achieve greater cost reductions by promoting cooperation between the companies. The Ministry of Maritime Affairs and Korea Maritime Development Corporation are also committed to supporting the launch of the alliance with preferential interest rates for securing new ships and container boxes.
The alliance is also expected to create better relations with international allies and can become a leader in transshipment and serve as a feeder for the routes to Europe and the Americas.
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